SES FDR

Annual Report • Apr 4, 2019

A CLOUD-SCALE CONNECTED FUTURE

Annual Report 2018

CONTENTS

INTRODUCTION	5
- Our Purpose	11
- Company Structure	12
- Financial Highlights	13
- Launch Manifest	14
- Network Map	16
SES VIDEO	18
SES NETWORKS	24
WHAT'S NEXT	30
CORPORATE GOVERNANCE	32
- Shareholders	34
- Chairman's Report	36
- Board of Directors	38
- Our Governance Structure	42
- Key Risk Areas	50
- Internal Control Procedures	56
- Environmental, Social, and Governance (ESG)	60
FINANCIAL REVIEW BY MANAGEMENT	66
CONSOLIDATED FINANCIAL STATEMENTS	74
SES S.A. ANNUAL ACCOUNTS	150
INFORMATION FOR SHAREHOLDERS	176

SES is the world's leading satellite operator with over 70 satellites in two different orbits, Geostationary Orbit (GEO) and Medium Earth Orbit (MEO). We provide a diverse range of customers with global video distribution and data connectivity services through two business units: SES Video and SES Networks. The SES Video portfolio includes MX1, a leading media service provider offering a full suite of innovative services for both linear and digital distribution, and the ASTRA satellite system, which has the largest DTH television reach in Europe. SES Networks provides global managed data services, connecting people in a variety of sectors including telecommunications, maritime, aeronautical, and energy, as well as governments and institutions across the world. The SES Networks portfolio includes GovSat, a 50/50 public-private partnership between SES and the Luxembourg government, and O3b, the only non-geostationary system delivering fibre-like broadband services today.

4

INTRODUCTION

2018 was a year of incredible evolution. After wishing farewell to our former CEO, we moved to a new chapter with Steve Collar, who began to make his mark in his first six months with a captivating vision for our customer base and a series of transformational internal initiatives. Beyond that, we saw four successful launches, including the long-anticipated first GovSat satellite and four additons to our O3b constellation.

Our growing SES Networks business is now reaching all corners of the planet on the ground, at sea and in the air. We continue taking strides with our upcoming O3b mPOWER constellation, set to launch in 2021. We make sure our customers are getting exactly what they need, tailoring network solutions in the telecommunications, maritime, aeronautical, energy, and government sectors. Customers in each of these markets are using our unique MEO and GEO satellite fleet and extensive ground infrastructure to fuel powerful, data-hungry applications in the cloud-scale connectivity ecosystem.

Large and resilient, SES Video proved again to be the backbone of our business. Our satellites serve more than 8,100 channels to more than one billion people across the world, ensuring complete quality control of the end product for our customers. Today's video customer requires more than just broadcast, and our range of solutions includes the preparation and transmission of content for both linear and non-linear platforms, as well as a full suite of media services including digital distribution and playout of content for videoon-demand, streaming, and high-resolution satellite TV.

Once viewed as complex, expensive, and proprietary, the traditional role of satellites has been completely transformed through investment, innovation and application. As satellite becomes increasingly seamless, combined with its inherent global reach advantages, it is leading the charge to bridge the digital divide, open new markets and enable opportunities through innovative and affordable managed data services. In doing so, the satellites we operate help our customers elevate the service experience and benefit end users all over the world.

This report is your comprehensive guide to SES in 2018, including our proudest moments, fascinating case studies, and detailed financial results. Read on and enjoy.

A STRONG YEAR OF EXECUTION

Romain Bausch Chairman

Since the day SES launched its first satellite – a 30-year anniversary that we celebrated this year – until today, SES has been part of a changing and evolving landscape of services delivered from space. As we have broadened our reach from Direct-to-Home (DTH), to broad video distribution and contribution and into data services, over this period our ability to touch lives and have an impact on the world has grown. This was underscored further in our early investment in and ultimate acquisition of O3b, now fully part of SES Networks, and its unique capabilities to deliver true 'Telco' services to the most remote and disconnected populations. Over 30 years, SES has transformed itself time and time again to be able to respond to the needs of the market and prepare for the future—a future that as we look forward will be defined by the inexorable demand for video content and data across a multitude of platforms, devices and geographies.

2018 was an important year for SES. We executed well as a business, both in terms of financial results and in terms of preparing for our future. The company delivered a solid year, exceeding revenue expectations, growing cash flow, limiting capex and managing leverage. At the same time, we launched a record number of satellites, executing flawlessly in placing the capacity and capabilities into orbit that will fuel our future development and growth as a company.

I am proud that our video business serves more than 355 million households. That reflects an audience of approximately 1 billion people, or 15% of the world's population. Together with our customers and platform partners we have built a reach that is unrivalled. To these strong neighbourhoods, we have added digital video solutions and capabilities to serve customers with 'Over the Top' and 'On Demand' content as well as the very highest quality linear distribution. We carry more Ultra-High Definition and High Definition content than any other operator and continue to innovate to deliver even higher quality programming for our customers.

The growth that we have delivered in 2018 from our networks business is particularly gratifying given the investments that we have made in transforming SES from a heavily video-focused business to one that is now more balanced between video and networks. This is a trend that I expect to continue in the coming years as we continue to make satellite a much more integral part of terrestrial-hybrid networks.

Given the solid financial performance, the Board of Directors has proposed a dividend of EUR 0.80 per Class A share for 2018, the same as in 2017, representing a yield of approximately 5%. On behalf of the Board of Directors, I would like to thank our shareholders for their continued confidence in our business.

In April 2018, Steve Collar was appointed as President and CEO, having previously been the CEO at SES Networks; Andrew Browne returned to SES as CFO. I am grateful to Steve, Andrew and the rest of the management team at SES for a strong year of execution. They have positioned SES in a fast-changing environment, built world-class capabilities within the leadership team, and restructured our business and organisation, most recently with the addition of a new Head of Global Services, a reflection of our strong focus on customer success.

We look forward to 2019 with much confidence. With our human capital, our industry position, our solid balance sheet and our differentiated assets and capabilities, we have a truly bright future ahead.

Romain Bausch

PREPARING FOR A CLOUD-CONNECTED FUTURE

Steve Collar President and CEO

2018 was a year of significant progress for SES, a year in which we delivered a strong set of financial results, posted double-digit and industry-leading growth in our networks business, and signed our first major cloud partnership. We launched a record number of satellites that will drive our future revenue streams and delivered a compelling vision for our network of the future, anchored by our brand new state-of-the-art constellation, O3b mPOWER, launching us towards a new decade of cloud-scale connectivity and a cloud-enabled future.

Our industry is in the midst of the most significant and prolonged period of change and disruption since the advent of DTH. In video, changes in consumer behaviour combined with an explosion in the number of ways to access that content present both challenges and opportunities for our broadcast customers. In networks, high-throughput satellites are now an integral part of our ecosystem, with enormous technical advances in space now translating directly into better economics for customers, enabling more business cases and proliferating new applications that can be affordably carried across satellite technology.

I was privileged and humbled to be appointed CEO of SES in April 2018, and, upon taking up the reigns together with our new CFO Andrew Browne, it was apparent that our focus for 2018 should be on the strong execution in the core of our business, delivering on the promises that we had made as a business to our shareholders and investors, while preparing the company for an exciting future. A year on, I am genuinely pleased with the demonstrable progress that we have made and with the results that we have posted.

Revenue in 2018 exceeded the top end of our guidance range on the back of an exceptionally strong year at SES Networks. It was a breakout year for our networks business with double digit revenue growth, underlying growth in all three major market verticals and the strongest year to date in terms of new business signed. Underlying growth of 2.1% in Fixed Data, 35.4% in Mobility and 19.4% in Government reflects a year in which all segments contributed substantially, leveraging the important new infrastructure that we had successfully brought to the market.

Our Aeronautical business was the star performer in 2018 following the entry into service in January of SES-15. Only a few weeks into the year, our customer Gogo had already transitioned 200 active aircraft across to SES-15. From our prime position over North America we support the

three leading players Gogo, Global Eagle and Panasonic to serve all major airlines in the US. We also consolidated our leading position in the cruise market with important wins with Carnival Corporation, MSC Cruises and Genting, who, together with our first cruise customer, Royal Caribbean Cruise Lines, represent more than 80% of the cruise market. John Padgett, Chief Innovation Officer at Carnival Corporation and the inspiration behind the Ocean Medallion, a revolutionary IoT innovation enabled by SES, spoke eloquently to our sales team recently about the seamless integration of satellite technology and cloud to deliver frictionless customer experience. These partnerships form the bedrock of what we do at SES Networks.

Our business with the US Government grew substantially in 2018 with the strong adoption of O3b. In Global Government we expanded our relationship with the UN Peacekeepers and delivered on important infrastructure projects, such as our cooperation with the government of Burkina Faso to build out an e-government network across the country. Even in Fixed Data, a segment that had borne the brunt of the industry disruption, we have grown, supporting the APEC summit in Papua New Guinea with important broadband connectivity through our partnership with DataCo. We also have grown our business in Brazil with Claro, supporting rural connectivity in the Amazonas region, and rolled out a fully managed cellular backhaul network for Tigo-Millicom in Chad, the first backhaul network to truly leverage both our MEO and GEO satellite assets.

SES Video, representing two-thirds of our group revenue, also performed well in 2018, delivering on our video revenue guidance and scoring some important wins despite challenging market conditions. Over the course of the year we have signed new customers and platforms while securing important renewals in our core neighbourhoods, including Viacom, M7 and QVC in Europe and Comcast in North America. Given our 30+ year experience as one of the first providers of Direct-to-Home (DTH) services, I am delighted that we signed multi-year agreements to launch and expand new DTH platforms in the Caribbean (Kiwisat) and in Eastern Europe (Telekom Srbija). In our video services business, MX1, new deals were secured with Agence France-Press, Discovery and Cell-C, while our HD+ service in Germany expanded with the addition of a bouquet of Ultra High Definition channels from RTL. We continue to carry more HD and UHD channels across the SES network than any other satellite service provider.

We have launched more satellites in 2018 than ever before with four successful launches in the first six months of the year. SES-15, GovSat-1, SES-14 and four new O3b satellites all commenced service during the year. SES-12, also launched in 2018, has begun delivering services in February 2019 while the launch of the final four O3b satellites of the first generation remains on track for early April 2019.

2018 also saw us make significant progress with our C-band initiative in the U.S. —a transformational opportunity for the company. Today, our market-based proposal is well placed to facilitate a leading position for the U.S. in 5G while protecting the broadcast community and the others we serve in the C-band. Together with our industry partners Intelsat, Eutelsat and Telesat, we have formed the C-Band Alliance, proven our technical solution, developed a plan to launch additional satellite resources in collaboration with our partners and are fully engaged with the FCC to deliver a true and historic win-win for all those intent on the creation of a competitive and vibrant 5G environment in the U.S. There will certainly be more to come on this important initiative in 2019.

As we look to 2020 and beyond, I could not be more excited about the progress that we are making on our nextgeneration MEO constellation, O3b mPOWER. Our new fleet offers true cloud-scale connectivity and will be the world's first terabit constellation, serving all SES Networks' verticals and delivering unparalleled reach and connectivity. With more than 5,000 beams per satellite compared with 10 per satellite

on the current O3b system, and with limitless flexibility in how and where to serve our customers, we have taken the successful O3b business model and concept of operations and scaled it exponentially. Our first cloud partnership signed with IBM in 2018 points the way to a cloud-scale future as we provide the customers of SES and IBM access to IBM's Direct Link and the multitude of cloud services that IBM provides. In the future, the SES satellite network will provide a seamless extension of cloud and terrestrial networks with applications and services routed flexibly over intelligent hybrid satellite and terrestrial networks.

2019 is going to be another big year for SES. The challenges and opportunities are approaching quickly as we grow and develop our business in a rapidly changing market. Our focus will remain on our customers, delivering exceptional value, experience and success. There is much more ahead of us than behind us at SES, so much for us to achieve and so much to be excited by.

All the best,

Steve Collar

Carnival's Chief Experience Officer John Padgett at SES Networks' Sales Kick-Off

OUR PURPOSE

We are here to MAKE A DIFFERENCE

Our purpose is to raise up the human experience. Every individual on the planet should be connected to the world's content. We are part of something bigger and what we do makes a difference.

We are obsessed with CUSTOMER SUCCESS

Our success depends on our customer success. Our customers are part of our family.

What we do is EXTRAORDINARY

We do the extraordinary in space to enable our customers to deliver the amazing on Earth. We challenge ourselves every day to deliver the extraordinary

We use our team & talent to

GIVE BACK

We have a team of talented and committed people at SES inspired to give back. In education, health, in making connections, in bridging cultures, in contributing to our communities and to our society

COMPANY STRUCTURE

SES provides a differentiated global offer with a complete range of value-added services.

SES VIDEO

100% Delivers linear and non-linear audiovisual content to the highest standard in all formats and via all distribution channels. www.mx1.com

SES NETWORKS

100% Provides total communications capacity for the US government and related agencies, from satellite bandwidth to customised end-to-end solutions with hosted payloads. www.ses-gs.com

100% Broadcasts popular free-to-air TV channels in high definition to the German market. www.hd-plus.de

SES owns or holds strategic participation in several satellite operators:

100% QuetzSat is a Mexican satellite operator that serves Mexico and the US with DTH TV services. QuetzSat operates from the orbital position 77°W. www.quetzsat.com

35% YahLive is a partnership between SES and YahSat in Abu Dhabi. YahLive owns and commercialises 23 Ku-band transponders on the Yahsat 1A satellite to provide direct-to-home television capacity and services to numerous countries in the Middle East, North Africa and Southwest Africa. www.yahlive.com

70% Ciel is a Canadian satellite service that works to bring the highest quality digital television and broadband services to homes and businesses throughout North America. Currently using orbital positions 129°W, 103°W and 86.5°W.

www.cielsatellite.ca

GovSat is a 50/50 public-private partnership between SES and the Luxembourg government. GovSat-1 is a multi-mission satellite that uses X-band and Military Ka-band frequencies on high-power and fully steerable mission beams to support multiple government related operations.

www.govsat.lu

FINANCIAL HIGHLIGHTS

Reported revenue up 1.7%1

2017 € 2,035.0 million

€ 1,292.1M

Video underlying revenue2 4.0% lower1

2017 € 1,373.2 million

2017 € 1.324.2 million

€ 870.5M

2017 € 760.8 million

Free cash flow before financing up 14.4%

€ 1,963.2M

Underlying revenue2 up 1.9%1

2017 € 1,979.8 million

€ 671.1M Networks underlying revenue2 up 15.8%1

2017 € 606.6 million

€ 292.4M³ Net profit attributable to SES shareholders

2017 € 596.1 million4

€ 6.8B Fully protected contract backlog

2017 € 7.5 billion

€ 0.80 Dividend per Class A share stable compared with 2017

2017 € 0.80

Net debt to EBITDA5 in line with SES's commitment to investment grade credit

3.29 times

status

2017 3.27 times

1 Comparative figures are restated at constant FX to neutralise currency variations

2 Excluding periodic and other revenue (disclosed separately) that are not directly related to or would distort the underlying business trends

3 Including impairment expenses of EUR 156.4 million and income tax benefit of EUR 41.9 million

4 Including impairment expenses of EUR 40.3 million and income tax benefit of EUR 130.6 million

5 Rating agency methodology treats the hybrid bonds as 50% debt and 50% equity. Net debt to EBITDA represents the ratio of net debt plus 50% of the group's EUR 1.3 billion of hybrid bonds, divided by the last 12 months' EBITDA.

LAUNCH MANIFEST LAUNCH MANIFEST

2019 - 2021 2019 - 2021

Region: Americas Application: Networks

Region: Global Application: Networks

LAUNCH MANIFEST

2019 - 2021

2021

Region: Global Application: Networks

18

SES in numbers SES in numbers

SES share of global channels broadcast via satellite

620

hours of premium sports & live events daily

3 Media assets are any video file (SD/HD/4K/ etc), programme, audio file, subtitle file, graphic file, etc

24%

38%

HD

SES

33%

of all SES channels are HD

DTT

DTC IPTV

150M 20M 42M

8,400

hours of streaming video delivered daily

143M

HD

UHD SES SES

Ultra HD channels

5,300 SD channels

2,700 HD channels

50

UHD

HD

SD

DTH

19%

Total

8,100

channels

SES global reach per TV reception mode

1 This number excludes occasional use 2 This includes SES and third party capacity

SES share of global channels broadcast via satellite

1 This number excludes occasional use

99%

SES in numbers

VIDEO

5M

Media assets3

Coverage of the globe

397¹

SES AND MX1 COVER THE

525

Managed playout channels

COMPLETE VIDEO VALUE-CHAIN

Revenue generating customers

€4.5B

HOMES

SES global reach

355M

of video contract backlog

3,600

over satellite, fibre, and IP2

Broadcast TV channels distributed

2 This includes SES and third party capacity

3 Media assets are any video file (SD/HD/4K/ etc), programme, audio file, subtitle file, graphic file, etc

Case studies

SES Video is the stable business that enables innovation and growth throughout the company. As consumer demand for high-definition services increases, we enable our customers to deliver the best Ultra HD experience.

As a first-mover in Ultra HD linear TV, we supported the introduction of general entertainment channels launching UHD versions as early as 2013. Following the introduction of UHD channels like Sky, Canal+ and Viasat, leading broadcasters are now launching UHD as part of both paid packages and free-to-air channels like QVC and Fashion One. Ultra HD is expanding across the globe, increasing in the Americas. We brought Insight TV to Latin America in April, which provided the Spanish, English, and Portuguese speakers access to 4K action sports, entertainment, and lifestyle programming. Furthermore, as 8K is now available in the market, SES is at the cutting edge of developing broadcast standards for those services in the future. In May, we demoed the broadcast of an 8K signal at our Industry Days.

Expanding our reach in Latin America, including a 27.4% increase in DTH channels, in 2018 we signed a multi-year agreement with PCTV, Latin America's largest television programming distributor. Our key orbital position of 47.5° East granted the distributor access to more households in Central and South America. Also, the satellite TV provider Kiwisat launched a new DTH offering in the Caribbean to consumers on the islands using SES-10 at 67° West.

In Europe, we have signed an agreement with Telekom Srbija to launch a new DTH platform that will broadcast more than 150 channels to Serbia, Bosnia and Herzegovina, and Montenegro. Additionally, the public broadcaster RTS now transmits its entire bouquet of nine TV channels and four radio stations thanks to Astra at 5° East, following the extension of another deal between SES and Telekom Srbija. In its neighbour Romania, the media provider Globecast also extended a partnership with SES for the premium TV distribution services it provides to Orange Romania. Furthermore, the M7 Group extended their agreement

> Kiwisat video

> AFP video

with SES for the delivery of its channels in the Benelux and German-speaking regions for the next three years via Europe's prime orbital position of 19.2° East.

North America continues to rely on SES for the distribution of their cable networks in the long-term, which is underlined in the CBA proposal to the FCC regarding the C-band spectrum usage in the US. The proposal ensures the continued seamless distribution of video and audio programming to more than 100 million US households and the reliable provision of data connectivity delivered in rural areas, in emergency situations and to the US government. We go into more details about the CBA in a later section.

SES has seen great expansion in sports broadcasting both for UHD and HD services around the globe. Last Summer, MX1 supported multiple clients with multiple requirements to aggregate, manage and deliver all the FIFA World Cup games to any screen in multiple formats. MX1 delivered the premium football content via its hybrid network using satellite, fibre and IP. They weren't the only ones going live: in April, Mediengruppe RTL Deutschland started broadcasting its RTL UHD to German viewers via SES's HD platform HD+. This included launching the channel with the live transmission of the Formula 1™ race from Baku, Azerbaijan, and subsequently broadcast 17 races of the 2018 season. We even qualified for the Olympics: NBC Sports Group selected SES to provide 4K High Dynamic Range satellite distribution for its production of the XXIII Olympic Winter Games.

Our MX1 business segment has also been delivering live TV along with linear channels—one such example is broadcasting to multiple devices for Cell C customers by working with the strong partner Vubiquity. MX1 also launched OU Flex, which is designed to deliver both video distribution and IP connectivity on-location for news and events. Through Smart Mobile Labs' LTE technology, OU Flex has been able to provide reliable on-site networks as well as Wi-Fi hotspots.

AFP sought a global company to help it develop its live video offer, improve the flexibility of its delivery and better address the various needs of its clients worldwide. Where previously it delivered only one HD news feed over satellite to broadcasters and publishers, it needed the ability to deliver four simultaneous feeds and make them available to any type of media. MX1 provides a complete range of digital media services including processing and delivering aggregated news content over a secure IP-based news distribution workflow, facilitated by the new branded platform.

In 2018 we continued to introduce innovative business models to developing TV markets. For example, we partnered with AfricaXP to launch a new collection of 13 free-toair channels in West Africa, affirming the innovative new business model targeting English-speaking West Africa. Using our ASTRA 2G satellite, this offer is a collaboration with MX1, who is providing the necessary ground services such as uplinking, encoding, playout servers, and ad-insertion. We are also continuing to see household reach for StarTimes, Canal Plus and Wananchi across Africa to over 30 million homes.

SES NETWORKS

SES in numbers SES in numbers

SES Networks Global Government

2x

SES Government Solutions² Serving customers across

54 GEO

3 GEO

leading IFC service providers

50%

1 https://www.itnews.com.au/news/newcrest-puts-digital-back-on-lihir-mine-roadmap-478845 2 SES Government Solutions (SES GS) is a wholly-owned subsidiary of SES and is exclusively focused on meeting the satellite communications needs of the US Government.

4

of all satellite-

enabled connected aircraft use SES capacity at some point HTS 16 MEO

Enabling digitisation

4/6

Oil & Gas Supermajors

saved per day per employee1

minutes of 10productivity

HTS

widebeam satellites

5 Gbps

of MEO to US Govt sites worldwide

15 US DoD agencies

increase of MEO sites over 2018

2 SES Government Solutions (SES GS) is a wholly-owned subsidiary of SES and is exclusively

focused on meeting the satellite communications needs of the US Government.

NETWORKS

Industry leading latency

SES in numbers

<150

MILLISECONDS

MEF CE 2.0

st

1

WORLD'S

satellite

standardisation

5G

LEADER IN

Certification over satellite

Telecom/MNO

of the world's largest

Providing highperformance communications around the globe to

7/10

25M

Telcos

end-users

Unique capabilities

73

SATELLITES

High-speed connection

to cruise ships

of up to

24

Gbps

growth in ships using Signature

600%

Maritime Solutions in 2018

NETWORKS

Case studies

Complementary to the SES Video segment, SES Networks took great strides in making its mark on the satellite industry. Let's explore a few of the highlights.

SES-14 and SES-15 became fully operational at the beginning of the year, offering our data customers more cost-effective services through the new high-throughput (HTS) technology that increases bandwidth capacity through frequency reuse. We also added 38% more capacity throughout the globe with the launch of O3b 13-16 satellites, growing the addressable market from +/- 45 to +/- 50 degrees latitude.

We are also proud to report that we are the only satellitebased service provider to have been certified as an IBM Cloud partner through the IBM Cloud Direct Link Service Provider Program, which allows us to connect IBM customers to the cloud and deliver an improved digital experience in various customer segments. Over our MEO link, we bring productivity advantages at enterprise quality anywhere on earth. This includes low-latency cloud services, optimised IoT and AI solutions, dedicated private or remote connectivity, rapid deployment of connectivity services and continuous emergency preparedness strategies.

Our fixed data services once again brought us to the most remote corners of the planet, connecting places that before had either no, or very limited, connectivity. Today, mobile network operator Millicom subsidiary Tigo Chad is leveraging a fully-managed end-to-end cellular backhaul solution based on SES's GEO fleet. As a result, Millicom subscribers in remote locations of land-locked Chad will be able to continue to enjoy and expand their 2G and 3G connectivity. Along with being the first customer that takes managed MEO and GEO services in an e2e configuration, the satelliteenabled backhaul service will link more than 50 remote sites, providing in-country gateway, remote terminals and maintenance services. Moving west to the Caribbean, Cuban national telecommunications operator ETECSA is using a new satellite-based system to diversify connectivity on the main island.

On the other side of the world, Our Telekom is ramping up connectivity across the Solomon Islands with GEO capacity, adding to the existing fibre-like MEO service they currently experience.

On the government services side, we have been working closely with the administrations in the United States to ensure security and support innovation. In June, SES Government Solutions (SES GS) signed a single-award Blanket Purchase Agreement with the Department of Defence to access MEO managed services until 2023. With this agreement, U.S. DoD customers will have the opportunity to access SES's industry-leading O3b MEO services worldwide. The BPA scope of work includes managed services (HTS capacity and broadband services, gateway services, and monitoring and control services), satellite terminals, field service representative (FSR) support, training and terrestrial backhaul. In terms of global government, we increased the number of missions in Africa by 70%, which contributed to our 32% revenue growth overall in the global government segment. We've deployed MEO terminals as part of the ICT infrastructure for the government of Burkina Faso that will enable applications like e-government, e-education, and e-health. With the launch of GovSat-1 in January 2018, we have secured contracts for services in Europe, Africa and the Middle East for a variety of missions and government departments.

> Axesat video

> DataCo video

2018 also saw the launch of SES-14, which hosted a payload for NASA's new Global-scale Observations of the Limb and Disk (GOLD) program. The program was created to explore and understand near-Earth space, which is home to astronauts, radio signals used to guide airplanes and ships, and satellites that provide communications and GPS systems.

In June, SES teamed up with ESA and other research organisations, universities and leading industry representatives to establish a Quantum Cryptography Telecommunication System (QUARTZ), a system that will generate encryption keys in space, and securely transmit those keys to users on Earth via laser.

More people than ever are connecting on-the-go with our latest mobility services and partnerships. In the air, Gogo provided its 2Ku inflight connectivity technology to more than 200 aircraft during SES-15's first operational month in January, demonstrating its seamless HTS function. Due to SES-15's high-powered HTS beams, all Gogo aircraft outfitted with its next generation modem will experience an even better customer experience with improved economics.

On the sea, we entered into an agreement with Navarino to provide managed end-to-end maritime connectivity to commercial vessels, allowing crew to work more efficiently as well as enabling them to maintain contact with loved ones back home. In February, we demonstrated that cruise passengers can now access the internet at speeds better than typical land-based hotel connectivity by delivering more than two gigabits per second of bandwidth to Carnival Corporation and Princess Cruises' Regal Princess as part of a special event. We also provide connectivity to guests and crew on board MSC Cruises, who enjoy a fully optimised vacation experience delivered via ultra-fast and reliable broadband connectivity using SES's global fleet of both MEO and GEO satellites.

We continued to lead in terms of standardisation, with SES remaining the only satellite-based service provider to certify and launch MEF CE 2.0 services, on a mission to transform satellite-based networks into a standards-driven environment. Adhering to the same, robust MEF-compliant service level agreements for latency, jitter, and throughput creates a standardised and trusted baseline for companies to demonstrate their quality.

We have also become a founding member of the new Linux Foundation Networking Fund (LFN), which streamlines efforts across various projects such as ONAP for network automation. Furthermore, we are testing and integrating SD-WAN, MEC, vEPC, and many other technologies into our network solutions to address the growing demand for open, seamless services and applications.

Of course, one of the most exciting new developments for SES is the upcoming O3b mPOWER system developments, which we will cover in the next section.

Burkina Faso enjoys its new ICT infrastructure deployed by SES.

WHAT'S NEXT

O3b mPOWER, C-band in the US and 5G

Before we get into the numbers, let's have a look at what is coming up ahead of us.

O3b mPOWER

Among the biggest projects we are looking forward to, the O3b mPOWER system is on track to be launched in 2021. The system will be based on a constellation of seven MEO satellites manufactured by Boeing. Each of the seven O3b mPOWER satellites provides more than 5,000 beams, which can be combined into fewer, more capable beams as needed. Each satellite has a throughput 10 times greater than those in the first-generation constellation, delivering a multiple terabits-per-second constellation that scales as more satellites are added. In comparison, each of the current O3b MEO satellites provides 12 fully steerable Ka band beams (two for gateways and 10 for remote terminals) and has an aggregate capacity of 16 gigabits per second. The beams each illuminate an area of Earth's surface measuring 700 kilometres across.

With the only operational NGSO-based satellite network, which gives us the unique combination of high performance and global coverage, one of our greatest strengths lies in our ability to take our customers from the edge to the cloud, and bringing the data they need back from the cloud to the edge. This strength is based on a satellite's ability to reach millions of people regardless of geographical terrain and physical distance. O3b mPOWER expands and intensifies this ability to an area of nearly 400 million square kilometres, especially in remote locations that are lacking terrestrial networks.

Today's satellite telecommunications services typically provision more bandwidth on the forward path than on the return path. However, end users are now becoming creators of content, not just consumers. The way in which communications services are being used is changing, and there is growing demand for more flexible forward/return ratios. For example, mobile military assets conducting Intelligence, Surveillance, and Reconnaissance (ISR) missions frequently acquire very large quantities of image or radar data, which need to be transmitted to a distant ground facility. Doing this via traditional satellite architecture imposes restrictions such as only being able to operate one of several instruments at any given time, or having to compress the image data, thereby losing the advantage of using high-resolution cameras. The extensive capacity of O3b mPOWER makes it possible to carry out these types of missions without these restrictions.

The new satellites will seamlessly integrate into our current O3b and GEO fleet, including SES-17 and the next batch of O3b satellites going up in the first quarter of 2019, and our partners are investing in significant ground infrastructure innovations. ALCAN, Viasat, and Istotropic Systems are developing application-specific prototypes that converge storage, computing and routing resources with software intelligence to introduce a new concept for the network endpoint: a small, fast and easy-to-install O3b mPOWER Customer Edge Terminal.

> O3b mPOWER gives customers complete flexibility to focus power wherever it is needed

Satellite infrastructure for 5G: seamless integration

C-band in the US and 5G

We can't talk about the future in satellites without mentioning 5G – in particular, the satellite operators' proposal in the US to clear a part of the C-band spectrum for the roll-out of 5G. Intelsat and SES created a consortium called the C-Band Alliance, or CBA, in order to align the US C-band operators in their intention to make a portion of the highly important spectrum available for 5G in a speedy process. Eutelsat and Telesat joined that initiative. The CBA proposal focuses on two goals: protect the existing C-band ecosystem which provides TV and radio programmes to more than 100 million households in the US and facilitate a fast roll-out of 5G in the US. The proposal protects hundreds of broadcasters and billions of dollars of investment in the spectrum and the ecosystem. At the same time, it puts the US in a pole position for 5G and thus helps accelerate GDP growth. If the FCC accepts the proposal, it could be implemented in 18 to 36 months of a final order. The CBA and its members continue to collaborate with the FCC and other stakeholders, elaborate plans for the technical implementation and transition and advocate for adoption of its proposal.

The benefits of 5G are not just limited to the US, and satellite technology can help push common content to the edge of 5G networks so that they can be delivered to mobile devices with minimal delay. The next generation of mobile technology promises to fundamentally change how consumers and businesses communicate, paving the way for new use cases that capitalise on 5G's speed, flexibility and low latency. The success of a truly global 5G network needs to be built on an ecosystem of interconnected networks, utilising multiple different and complementary technologies that comprise both terrestrial and satellite infrastructure. We are doing our part to support the future 5G ecosystem by investing in multi-orbit capabilities in GEO and MEO to address the massive bandwidth growth expected in 5G networks. In addition, we are working with institutions and industry players across the value chain to develop standards and protocols to integrate satellite seamlessly into the new 5G networks. Our successful initiatives in this area include the SaT5G consortium demo at the EuCNC2018 conference, where we showcased satellite backhauling features and efficient edge delivery of multimedia content as a proof-ofconcept for their integration into the 5G network. Last year saw another important milestone at the 9th FOKUS FUSECO Forum event, where SATis5 demonstrated 5G capabilities over satellite, including SDN, NFV and network slicing of enhanced mobile broadband and Internet-of-Things networks over satellite.

The coming months and years are expected to be an exciting time for SES. We are in the midst of a pivotal period in the space and connectivity industry, and we are proud to have a key role in it.

CORPORATE GOVERNANCE

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SHAREHOLDERS

The number of issued shares of each class as of 31 December 2018 was as follows:

SES Shareholders1	Number of Shares	% Voting Shareholding	% Economic Participation
A Shares
Nouvelle Santander Telecommunications S.A.	7,000,000	1.22%	1.52%
Sofina Capital S.A.	6,000,000	1.04%	1.30%
Luxempart Invest S. à r.l.	5,652,000	0.98%	1.23%
Other Shareholders	3,439,728	0.60%	0.75%
BCEE (Free Float)	361,365,872	62.83%	78.53%
Total A Shares	383,457,600	66.67%3	83.33%3
B Shares
BCEE	62,572,893	10.88%	5.44%

SNCI	62,565,085	10.88%	5.44%
Etat du Grand-Duché de Luxembourg	66,590,822	11.58%	5.79%
Total B Shares2	191,728,800	33.33%3	16.67%
Total Shares (Actual)	575,186,400
Total Shares (Economic)	460,149,120

1 Significant shareholdings as of 31 December 2018.

2 A B-share carries 40% of the economic rights of an A-share.

3 All figures have been rounded up to the second decimal, which may result in a rounding difference of the total percentage for A and B-shares.

Under IAS 33, the earnings per share and dividend per share calculations are made using the weighted average number of shares during the period. The weighted average number of shares is adjusted for the shares purchased by the company.

CHAIRMAN'S REPORT ON CORPORATE GOVERNANCE AND INTERNAL CONTROL PROCEDURES

INTRODUCTION

SES has been listed on the Luxembourg Stock Exchange since 1998 and on Euronext Paris since 2004. The company follows the 'Ten Principles of Corporate Governance' adopted by the Luxembourg Stock Exchange (its home market), as revised in 2017, a copy of which can be found at www. bourse.lu/corporate-governance. 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, for example concerning the publication of the individual remuneration of the members of its Executive Committee and its board members, SES follows the rules of the home market by reporting the aggregate amount of the remuneration of the members of the Executive Committee, with the fixed and the variable components of the benefits being separately identified.

SES meets all the recommendations made by the 'Ten Principles' except with regard to Recommendation 3.9, which states that the committees created by the Board should only have advisory powers. The SES Board has delegated some decision-making powers to the Remuneration Committee. For the full details of these powers, see the charter of the Remuneration Committee on the SES website (www.ses.com). After each meeting of the Remuneration Committee, its Chairman reports to the Board about the latest Remuneration Committee discussions and decisions.

The company is continuously increasing the flow of information to its shareholders via the corporate governance section of its website and communicates with its shareholders through the dedicated e-mail address shareholders@ses.com. In line with Luxembourg 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 governance 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. This section also contains the SES Code of Conduct and Ethics, the SES Dealing Code, the financial calendar and any other information that may be of interest to the company's shareholders.

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's articles of incorporation, in its latest version, is available in the corporate governance section of the company's website.

THE ANNUAL GENERAL MEETING OF SHAREHOLDERS

Under Luxembourg company law, the company's annual and/or extraordinary general meetings represent the entire body of shareholders 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 Chairman of the Board or, in his absence, by one of the Vice Chairmen of the Board or, in their absence, by any other person appointed by the meeting. Any shareholder who is recorded in the company's shareholder register 14 business 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 company has issued two classes of shares: A-shares and B-shares.

The State of Luxembourg holds a direct 11.58% voting interest in the company and two indirect interests, both of 10.88%, 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 B-shares.

Although they constitute separate classes of shares, A- and B-shares have the same rights, except that the B-shares 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 A-shareholders. B-shares are not freely traded. Each share, whether A- or B-share, is entitled to one vote. In accordance with the company's articles of incorporation, no A-shareholder may hold, directly or indirectly, more than 20%, 33% or 50% of the company's shares unless it has obtained prior approval from a meeting of the shareholders. Such limit is calculated by taking into account the shares of all classes held by an A-shareholder.

An A-shareholder or a potential shareholder who plans to acquire by whatever means, directly or indirectly, more than 20%, 33% or 50% of the shares of the company must inform the Chairman of the Board of such intention. The Chairman will then inform the government of Luxembourg of the planned acquisition, which may only be opposed by the government within three months of receiving such information, should it determine that such an acquisition is against the general public interest.

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 as 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%, 33% or 50% of the shares.

In accordance with article 8 of the Luxembourg law of January 11, 2008, as subsequently amended, any shareholder or FDR holder acquiring or disposing of shares or FDRs is required to inform the company and the Commission de Surveillance du Secteur Financier within four business days of the proportion of voting rights held as a

result of such acquisition or disposal where that proportion reaches, exceeds or falls below the thresholds of 5%, 10%, 15%, 20%, 25%, 33.33%, 50% or 66.66%.

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 annual general meeting, 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 annual general meeting of shareholders in person, that shareholder will need to convert at least one FDR into an A-share. In order to facilitate the attendance of the meeting by FDR holders, the company will pay the applicable charge for a conversion of up to 10,000 FDRs for a short period prior to the annual general meeting.

Notice of the meeting and of the proposed agenda will also be published 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 resolutions will be made available on the company's and on the fiduciary'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 incorporation. It may then validly deliberate without consideration of the number 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 annual general meeting.

With the exception of the procedure described above regarding whenever 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. The annual general meeting held on 5 April 2018 was attended by 98.180% of the company's shareholders, excluding the 6,525,148 FDRs held by the company.

During the 2018 annual general meeting, the shareholders used an electronic voting system. They approved the 2017 financial results and the allocation of the 2017 profits, granted discharge to the external auditor and to the directors, re-elected PricewaterhouseCoopers ('PwC') as the company's external auditor for another year, granted an authorisation to SES to buy back its own shares and decided to reduce the number of directors from 17 to 15. The shareholders also approved the directors' fees, which remained unchanged in comparison to 2017. Finally, shareholders re-elected five directors for a term of three years with a majority of at least 85.597%.

All of the Board's other proposals were carried by a majority of at least 98.420% of the votes cast. In accordance with article 450-3 of the Luxembourg company law, abstentions are not considered when determining whether a resolution has been passed or not. The detailed results of the shareholders' votes are available in the corporate governance section of the company's website.

The annual general meeting was followed by an extraordinary meeting of shareholders held in the presence of Me Joëlle Baden, notary in Luxembourg. The purpose of the meeting was to introduce an authorised share capital of up to 10% of the company's existing share capital without reserving to the existing shareholders any preferential subscription rights, as well as to bring the articles of association in line with the law of 10 August 1915 as amended. The meeting was attended by 98.180% of the shareholders, excluding the FDRs held by the company. Shareholders voted individually on each of the 15 amendments proposed by the Board of Directors. Each of the proposals was approved by at least 86.03% of the votes cast, well above the 66.66% threshold required for each amendment to pass.

THE BOARD OF DIRECTORS AND ITS COMMITTEES

MISSION

The Board of Directors is responsible for defining the company's strategic objectives as well as its overall corporate plan. The Board approves, upon proposal from the Executive Committee, 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. It also approves major investments and is responsible vis-à-vis shareholders and third parties for the management of the company, which it delegates to the Executive Committee in accordance with the company's internal regulations.

COMPOSITION

Following the decision taken by the shareholders at the annual general meeting in April 2018, the Board of SES is composed of 15 non-executive directors, four 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 annual general meeting of shareholders in April 2019, 2020 and 2021, respectively. Mr Romain Bausch, former

President and CEO until 3 April 2014, is the Chairman of the Board of Directors. He is assisted by two Vice Chairmen, Messrs François Tesch and Jean-Paul Zens, each one elected on the basis of proposals submitted by directors representing A-shareholders and B-shareholders, respectively. Their mandates as Chairman and Vice Chairman are annual mandates.

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 annual general meeting of shareholders will definitively elect the new director, who will complete the term of the director whose seat became vacant.

In accordance with internal regulations adopted by the Board, at least onethird 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:

• (i) not having been a director for more than 12 years;
• (ii) not having been an employee or officer of the company over the previous five years;
• (iii) not having had a material business relationship with the company over the last three years; and
• (iv) not representing a significant shareholder holding more than 5% of the voting shares directly or indirectly.

Seven of the current board members are considered independent: Mrs Tsega Gebreyes, Mrs Katrin Wehr-Seiter, Mr Marc Beuls, Mr Victor Casier, Mr Conny Kullman, Mr Ramu Potarazu and Mr Kaj-Erik Relander.

Of the eight directors who are not considered independent, five represent a significant shareholder owning more than 5% of the company's shares, two have been a director for more than 12 years and Romain Bausch has had a recent employment relationship with the company. From April 2019, he will be considered independent.

Mr Pierre Margue, Vice President Legal and Corporate Affairs, acts as secretary of the Board of Directors.

In the context of the Board composition, the SES Nomination Committee 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. The candidates should present most of the following competencies: (i) balanced international experience; (ii) satellite communication industry knowledge; (iii) non-satellite communication industry knowledge; (iv) video and data-centric products knowledge; (v) financial expertise (for Audit and Risk Committee); (vi) legal, regulatory and compliance expertise (for Audit and Risk Committee); (vii) HR expertise (for Remuneration and Nomination Committees); and (viii) experience in running a business amidst a changing business environment.

RULES OF GOVERNANCE

The Board of Directors meets when required by the company's business, 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 voting 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-shareholder owning at least 5% of the shares of the company, directly or indirectly, is subject to a prior authorisation by the Board. In 2018, there were no transactions between the company and any A-shareholder owning at least 5% of the company's shares directly or indirectly.

ACTIVITIES OF THE BOARD OF DIRECTORS IN 2018

The Board of Directors held eight meetings in 2018, with an attendance rate of more than 99%. After endorsement by the Audit and Risk Committee, the Board approved the 2017 audited accounts, including the proposed dividend, as well as the financial

results for the first half of 2018. During the year, the Board approved the updated strategic plan, the 2019 budget and the 2019- 2023 business plan. It was also briefed on the strategic plan implementation.

The Board also used its informal pre-Board sessions to develop its knowledge about the industry and its perception by outside investors through several presentations.

During 2018, the Board also decided to launch a new share buyback programme, which was implemented on Euronext Paris through the filing of a 'notice d'information' on 9 April 2018. The 2018 programme was limited to the following two objectives:

• (i) to operate under the framework of a liquidity contract signed with Rothschild, and
• (ii) to meet the company's obligations under its executive share ownership and stock option plans.

Under this programme, the company is authorised to buy back up to 20 million A-shares and 10 million B-shares at prices between EUR 5 and EUR 25 per A-share and EUR 2 and EUR 10 per B-share.

The Board further drew conclusions from the self-evaluation undertaken at the end of 2017. Finally, the Board approved several changes to the composition of the Executive Committee and it approved updated corporate governance documents. The Board noted updates on the company's risk management report. The Executive Committee regularly informed the Board about the group's activities and financial situation. It noted updates on: (i) 2018 Business Objectives; (ii) financial framework; (iii) corporate social responsibility; (iv) tax framework; (v) social report; and (vi) investor relations matters. The Board was also briefed on the company's roll-out of GDPR. Directors were invited to participate in the compulsory GDPR training for all employees.

At each meeting, directors receive a report on ongoing matters and the Chairmen of the three committees set up by the Board present a report on the latest developments discussed in these respective committees. In addition, a business report is distributed to the members of the Board on a monthly basis.

BOARD OF DIRECTORS

As of 31 December 2018

From left to right:

Back row: Ramu Potarazu, Katrin Wehr-Seiter, Hadelin de Liedekerke Beaufort, Marc Beuls, Romain Bausch, Conny Kullman, Serge Allegrezza, Anne-Catherine Ries, Kaj-Erik Relander, Tsega Gebreyes. Front row: François Tesch, Françoise Thoma, Victor Casier, Jean-Paul Zens. Not pictured: Jean-Paul Senninger

As of 31 December 2018, the 15 members of the Board of Directors were:

MR ROMAIN BAUSCH Chairman of the Board

Mr Bausch became a director on 4 April 2013. Following a career in the Luxembourg civil service (Ministry of Finance) where he occupied key positions in the banking, media and telecommunications sectors including a five-year term as a Director and Vice Chairman of SES, Mr Bausch was President and CEO of the Company from May 1995 to April 2014. Mr Bausch is the Chairman of the Board of Directors of SES and a Director of SES ASTRA. He is also a member of the Boards of Directors of Aperam, Banque Raiffeisen Société Coopérative, Compagnie Financière La Luxembourgeoise and the Luxembourg Future Fund, as well as a member of the CNFP (Conseil National des Finances Publiques) of Luxembourg. He graduated with a degree in economics (specialisation in business administration) from the University of Nancy. He holds an honorary doctorate from the Sacred Heart University in Luxembourg. He is a member of the Company's Remuneration Committee and of its Nomination Committee. Mr Bausch is a Luxembourg national. He is not an independent director because of his past employment relationship with SES, although he will be considered independent from April 2019.

MR FRANÇOIS TESCH Vice Chairman of the Board

Mr Tesch became a director on 15 April 1999. He is Executive Chairman of Luxempart SA. He graduated with a degree in economics from the Faculté d'Aix en Provence and holds an MBA from INSEAD (Institut Européen d'Administration des Affaires). He is also Chairman of the Board of Foyer SA, of Wealins SA and of Financière de Tubize SA, and Vice-Chairman of CapitalatWork Foyer Group. Mr Tesch is a Vice Chairman of the Board of Directors and a member of the Nomination Committee of SES.

Mr Tesch is a Luxembourg national. He is not an independent director because he has been a director for more than 12 years.

MR JEAN-PAUL ZENS Vice Chairman of the Board and Chairman of the Nomination Committee

Mr Zens became a director on 7 May 2002. He was elected as a Vice Chairman on the same date. Mr Zens is also a member of the Board of Directors of SES ASTRA. He retired as Director of the Media and Communications department of the Ministry of State in Luxembourg on 8 January 2019. He holds a law degree and a degree in psychology and communications sciences from the University of Strasbourg. Mr Zens is the Chairman of the Company's Nomination Committee and a member of its Remuneration Committee.

Mr Zens is a Luxembourg national. He is not an independent director because he represents an important shareholder.

MR 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 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 SA and a member 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 of SES.

Mr Allegrezza is a Luxembourg national. He is not an independent director because he represents an important shareholder.

MR MARC BEULS

Chairman of the Audit and Risk Committee Mr Beuls became a director on 7 April 2011. He serves as a Member of the Board of Directors at Maris Ltd, a Mauritian holding company investing in frontier markets in Africa, Qaelum NV, Belgium, providing software solutions for quality control of medical imaging, and WindGen Power USA Inc., building and operating smart micro grids in Africa. He is the Chairman of American Prepaid Value VAS LLC, USA, developing value added services for the wireless prepaid market. He is the former President and CEO of Millicom International Cellular SA, a position he held from 1998 to 2009. Prior to joining Millicom in 1992 as Senior Vice President in charge of finance and treasury, Mr Beuls worked for Generale Bank in Belgium, specialising in project and trade financing in emerging markets. Mr Beuls graduated from the Limburg Business School, currently UHasselt, holding a degree in economics with a major in finance. Mr Beuls

is Chairman of the Audit and Risk Committee of SES. Mr Beuls is a Belgian national. He is an

MR VICTOR CASIER

independent director.

Mr Casier became a director on 7 April 2016. Mr Victor Casier is a member of the Executive Committee of Sofina SA and a board member of various companies within Sofina's portfolio, including Vente-Privée.com, Global Lifting Partners and Spanish investment fund QMC II. Prior to joining Sofina, Mr Casier worked for Roland Berger Strategy Consultants, TranswideLimited and Banco Urquijo. Mr Casier holds an MBA from the University of Chicago, a Master in Business Engineering (Ingénieur de Gestion) from the Université Catholique de Louvain and a certificate from the INSEAD International Directors Programme (IDP). Mr Casier is a member of the Audit and Risk Committee of SES.

Mr Casier is a Belgian national. He is an independent director.

MR HADELIN DE LIEDEKERKE BEAUFORT

Mr de Liedekerke Beaufort became a director on 17 April 2000. He is currently a director of Santander Telecommunications, a privately held company, as well as a director of other private companies with interests in various fields such as financial, communication and real estate developments. Mr de Liedekerke Beaufort graduated from the Ecole Hôtelière de Lausanne. Mr de Liedekerke Beaufort is a member of the Remuneration Committee of SES.

Mr de Liedekerke Beaufort is a French national. He is not an independent director because he has been a director for more than 12 years.

MRS TSEGA GEBREYES

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 International BV and Senior Advisor to Zain. She was also Founding Partner of the New Africa Opportunity Fund, LLP and has worked with McKinsey and Citicorp. Mrs Gebreyes is a director of Satya Capital Limited and Sonae. She is a Senior Advisor to TPG Growth. She has a double major in Economics and International Studies from Rhodes College and holds an MBA from Harvard Business School. She is a member of the Remuneration Committee and of the Nomination Committee of SES.

Mrs Gebreyes is an Ethiopian national. She is an independent director.

MR CONNY KULLMAN

Chairman of the Remuneration Committee Mr Kullman became a director on 5 April 2012. He was a former Director General, CEO and Chairman of Intelsat. After working as a Systems Engineer for Saab-Ericsson Space AB in Sweden until 1983, he joined Intelsat in Washington DC, where he held several positions before becoming the company's Director General and CEO in 1998. Mr Kullman became the CEO of Intelsat, Ltd. in 2001, and in 2005, Chairman of Intelsat, Ltd., and CEO and President of Intelsat (Bermuda), Ltd., positions from which he retired in 2006. Mr Kullman graduated with a Master of Science in Electronic Engineering from the Chalmers University of Technology in Gothenburg in 1974. Mr Kullman is the Chairman of the Remuneration Committee and a member of the Nomination Committee of SES. Mr Kullman is a Swedish national. He is an independent director.

MR RAMU POTARAZU

Mr Potarazu became a director on 20 February 2014. He is 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. Mr Potarazu is a US national. He is an independent director.

MR KAJ-ERIK RELANDER

Mr Relander became a director on 6 April 2017. He is Senior Independent Advisor of Mubadala Development Company. 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 Committees. 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. He is Chairman of the Investment Committee at the private equity fund Apis.pe and a board director of Starzplay Arabia and Emirates Integrated Telecommunications Company PJSC in Dubai. Mr Relander is a member of the Audit and Risk Committee of SES.

Mr Relander is a Finnish national. He is an independent director.

MRS ANNE-CATHERINE RIES

Mrs Ries became a director on 1 January 2015. Mrs Ries is Senior Policy Advisor to the Prime Minister and Minister for Media and Communications in Luxembourg with a focus on telecom and digital strategy. She is in charge of coordinating the government's 'Digital Luxembourg' priority, among other duties. Anne-Catherine Ries graduated with a law degree from the Université de Paris II and the University of Oxford. She holds a postgraduate LL.M degree with honours from the London School of Economics, where she specialised in Telecommunications, Information Technology and European Competition Law. After starting her professional career in a law firm in Paris, she joined the Permanent Representation of Luxembourg to the EU in Brussels in 2000. Upon her return to Luxembourg and over the last decade, her focus has been on attracting tech companies to establish and develop in Luxembourg. She sits on the Board of Directors of POST Luxembourg. Mrs Anne-Catherine Ries is member 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 shareholder.

MR JEAN-PAUL SENNINGER

Mr Senninger became a director on 7 April 2016. He was the Secretary General of the Council of Ministers of the Luxembourg Government from December 2013 to December 2018. Currently he is Ambassador to Thailand and ASEAN. Mr Senninger joined the Ministry of Foreign Affairs in 1999 as

Premier Conseiller de Gouvernement. He was Luxembourg Ambassador to Spain (2004- 2008) and to the United States of America, Canada and Mexico (2008-2012). From 2012-December 2013, he was the Secretary General of the Ministry of Foreign Affairs. Mr Senninger also worked as attaché in the Office of the Mayor of Luxembourg City and as Senior Officer and Head of Unit at the European Investment Bank. Mr Senninger holds a BA in Political Science and a BA in Literature from the Friedrich Wilhelms Universität in Freiburg and a Master in European Studies from the College of Europe in Bruges. Mr Senninger is a Luxembourg national. He is not an independent director because he represents an important shareholder.

MS FRANÇOISE THOMA

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 SA, Luxair SA, the Luxembourg Stock Exchange and of Enovos Luxembourg SA. 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 a member of the Remuneration Committee and 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.

MRS KATRIN WEHR-SEITER

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 SA. Prior to joining BIP, she served as a Principal at global investment firm Permira and also worked as an independent strategy consultant as well as a Senior Advisor to international private equity group Bridgepoint. She started her professional career at Siemens AG where she held various positions in strategy consulting and engineering. She serves as a director of several non-listed corporations. 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 of the Company. Mrs Wehr-Seiter is a German national. She is an independent director.

OUR GOVERNANCE STRUCTURE

THE CHAIRMAN'S OFFICE	The Chairman's Office prepares the agenda for the Board meetings.
THE REMUNERATION COMMITTEE	The Remuneration Committee determines the remuneration of the members of the Executive Committee and advises on the overall remuneration policies applied throughout the company. It acts as administrator of the company's long-term equity plans.
THE AUDIT AND RISK COMMITTEE	The Audit and Risk Committee assists the Board in carrying out its oversight responsibilities in relation to corporate policies, risk management, internal control, internal and external audit and financial and regulatory reporting practices.
THE NOMINATION COMMITTEE	The Nomination Committee identifies and nominates suitable candidates for the Board of Directors, for election by the annual general meeting of shareholders. It also identifies and nominates suitable candidates for the Executive Committee.

COMMITTEES OF THE BOARD OF DIRECTORS

THE CHAIRMAN'S OFFICE

The Chairman and the two Vice Chairmen are members of the Chairman's Office. The Chairman's Office prepares the agenda for the Board meetings.

At 31 December 2018, the members were:

• Mr Romain Bausch
• Mr François Tesch
• Mr Jean-Paul Zens

The Chairman's Office met six times during 2018, with an attendance rate of 100%.

THE REMUNERATION COMMITTEE

In accordance with general corporate governance standards, the company's Board established a Remuneration Committee, which determines the remuneration of the members of the Executive Committee and which advises on the overall remuneration policies applied throughout the company. It reports to the Board at each meeting through its Chairman. The Remuneration Committee is comprised of six members, at least a third of whom are independent board members in line with SES's internal regulations. As of 31 December 2018, the Remuneration Committee was composed of the following six non-executive directors:

• Mr Conny Kullman (Chairman of the Remuneration Committee, independent)

• Mr Romain Bausch
• Mr Hadelin de Liedekerke Beaufort
• Mrs Tsega Gebreyes (independent)
• Ms Françoise Thoma
• Mr Jean-Paul Zens

The Remuneration Committee held seven meetings, with an attendance rate of more than 95%. Matters addressed related to the determination of the bonuses and the vesting of performance shares allocated to the members of the Executive Committee for their performance in 2017. The Remuneration Committee further adopted the 2018 corporate objectives, which are used as one element in the determination of their bonuses for 2018 as well as for the 2018 stock option grant. The Remuneration Committee also fixed the compensation for the new members of the Executive Committee who were appointed in 2018 (President and CEO, Chief Financial Officer and CEO Networks) as well as for the Chief Services Officer and the new Chief Technology Officer who joined the Executive Committee with effect from 1 January 2019. Furthermore, the Remuneration Committee discussed a minor amendment to the longterm equity plans of the company (related to the clauses "Change in Control" and "Change in Capital Structure") and agreed to reinforce the impact of performance and potential on equity grants. The proposed changes were subsequently adopted by the SES Board.

The Remuneration Committee also oversees the implementation of the decision under

which the members of the Executive Committee must hold at least the equivalent of an annual salary's worth of registered shares in the company (with the President and CEO of SES having to hold shares of at least two years' worth of his or her annual salary).

THE AUDIT AND RISK COMMITTEE

As part of its overall corporate governance, the Board established an Audit and Risk Committee, which assists the Board in carrying out its oversight responsibilities in relation to corporate policies, risk management, internal control, internal and external audit and financial and regulatory reporting practices. The Committee has an oversight function and provides a link between the internal and external auditors and the Board. The Audit and Risk Committee is composed of six members, four of whom are independent board members, in line with the SES internal regulations.

As of 31 December 2018, the Audit and Risk Committee was composed of the following six non-executive directors:

• Mr Marc Beuls, Chairman of the Audit and Risk Committee (independent)
• Mr Serge Allegrezza
• Mr Victor Casier (independent)
• Mr Kaj-Erik Relander (independent)
• Ms Françoise Thoma
• Mrs Katrin Wehr-Seiter (independent)

The Audit and Risk Committee held four meetings, with an attendance rate of 100%.

The meetings were dedicated in particular to the review of the 2017 financial results before their submission to the Board and their subsequent approval by the shareholders at the statutory annual general meeting and to the review of the H1 2018 financial results of the company. Members of the Board also had the opportunity to communicate any comments they had on the company's quarterly results through the Chairman of the Audit and Risk Committee prior to the publication of these results.

The Audit and Risk Committee reviewed the company's statement on internal control systems prior to its inclusion in the annual report, approved the Internal Audit plan, and received bi-annual updates on the Internal Audit activities and on the follow-up of the major recommendations. It also reviewed the 2017 PwC Management letter.

The Audit and Risk Committee proposed to the Board and to the shareholders to appoint PwC as external auditor for 2018 and it approved its compensation.

The Audit and Risk Committee received bi-annual updates on risk management from the SES risk management committee and discussed the company's readiness for compliance with the EU's General Data Protection Regulation. It was further briefed on ongoing compliance matters. Finally, the Audit and Risk Committee discussed the treasury roadmap, the tax framework, the financial framework and the potential impact of proposed organisation changes on the company's reporting obligations. After each meeting, the Board is briefed in writing about the work of the Audit and Risk Committee.

THE NOMINATION COMMITTEE

In line with best practice in corporate governance, the Board established a Nomination Committee, whose role is to identify and nominate suitable candidates for the Board of Directors, for election by the annual general meeting of shareholders. Such proposals are based on submissions from shareholders for a number of candidates at least equal to the number of posts to be filled for each class of shareholders. The Nomination Committee also proposes candidates for Executive Committee membership for election by the Board. The Nomination Committee is composed of six non-executive members, at least a third of whom are independent board members in

line with the SES internal regulations. On 31 December 2018, they were:

• Mr Jean-Paul Zens (Chairman of the Nomination Committee)
• Mr Romain Bausch
• Mrs Tsega Gebreyes (independent)
• Mr Conny Kullman (independent)
• Mrs Anne-Catherine Ries
• Mr François Tesch

The Nomination Committee met six times with all its members being present. It prepared the election of four directors as per the company's Board election process.

In the context of changes to the operating model, the Nomination Committee identified and proposed suitable candidates for nomination by the Board for the succession of the President and CEO, the Chief Financial Officer, the CEO Networks and the Chief Technology Officer. The Nomination Committee also proposed one additional member to the Executive Committee for nomination by the Board, namely, the Chief Services Officer.

After each meeting, the Board is briefed in writing about the work of the Nomination Committee.

THE EXECUTIVE COMMITTEE

MISSION

The Executive Committee of SES is known as the Senior Leadership Team and is in charge of the daily management of the group. It functions as a collegial body. The Senior Leadership Team is mandated to prepare and plan the overall policies and strategies 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 EUR 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 transactions can at no time be higher than EUR 30 million.

The Senior Leadership Team may approve any external credit facilities or external guarantees, 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 Senior Leadership Team informs the Board at its next meeting of each such increase.

The Senior Leadership Team submits those measures to the Board that it deems necessary to be taken in order to meet the purposes of the company. Prior to the beginning of each fiscal year, the Senior Leadership Team submits to the Board a consolidated budget for approval.

The Senior Leadership Team is in charge of implementing all decisions taken by the Board and by the committees specially mandated by the Board. The Senior Leadership Team may, in the interests of the company, sub-delegate part of its powers and duties to its members acting individually or jointly.

The President and CEO organises the work of the Senior Leadership Team and coordinates the activities of its members, who report directly to him or her. In order to facilitate the implementation by the Board of its overall duty to supervise the affairs of the company, the President and CEO informs the Chairman of the Board on a regular basis of the company's activities. The latter receives the agenda and the minutes of all meetings of the Senior Leadership Team in due time.

During 2018, the Senior Leadership Team met 27 times, with an attendance rate of 92.73%. Mr Pierre Margue, Vice President Legal and Corporate Affairs, the secretary of the Board of Directors, also acted as secretary to the Senior Leadership Team.

COMPOSITION

On 31 December 2018, the following eight individuals were members of the Executive Committee:

• the President and CEO (who assumes the chairmanship of the Executive Committee)
• the CEO SES Networks
• the CEO SES Video
• the Chief Financial Officer
• the Chief Human Resources Officer
• the Chief Legal Officer
• the Chief Strategy and Development Officer and
• the Chief Technology Officer

THE EXECUTIVE COMMITTEE

From left to right:

Christophe De Hauwer (Chief Strategy and Development Officer), Ferdinand Kayser (CEO SES Video), Andrew Browne (Chief Financial Officer), John Purvis (Chief Legal Officer), Steve Collar (President and CEO), Evie Roos (Chief Human Resources Officer), John-Paul Hemingway (CEO SES Networks), Martin Halliwell (Chief Technology Officer)

THE EXECUTIVE COMMITTEE

Members of the Executive Committee are appointed by the Board of Directors upon a proposal from the Nomination Committee.

As of 31 December 2018, the members of the Executive Committee are:

MR STEVE COLLAR President and CEO

Mr Steve Collar was appointed President and CEO in April 2018. He had been the CEO of SES Networks since April 2017. He is a member of the Board of SES ASTRA. Prior to SES Networks, Mr Collar was CEO of O3b Networks and guided the company through the successful build and launch of its constellation of state-of-the-art satellites. In 2015, O3b Networks became the fastest growing satellite operator in history. In 2016, O3b was fully acquired by SES and now forms an integral part of SES Networks. Mr Collar is a satellite industry veteran, having previously worked in a variety of commercial, business development and technical roles at SES WORLD SKIES, New Skies Satellites, Astrium and Matra Marconi Space (now Airbus). Mr Collar holds a degree in Mechanical Engineering from Brunel University in London.

Mr Collar is a British national.

MR ANDREW BROWNE Chief Financial Officer

Mr Andrew Browne was appointed Chief Financial Officer on 12 February 2018. Prior to this, Mr Browne was CFO of O3b Networks where he was a key player in bringing to reality the first MEO constellation providing service on a global basis to customers in the Maritime, Energy, Enterprise and Government sectors. Prior to joining O3b, he was Chief Financial Officer and member of the management board at SES from 2010. He is a member of the Board of SES ASTRA and he was also on the boards of Yahsat and O3b. Mr Browne was the CFO and Deputy CEO of Intelsat between 1995 and 1998. He then served as CFO of New Skies between 1998 and 2008, overseeing IPOs on the NYSE and Euronext before creating shareholder value through private sales to the Blackstone Group and ultimately to SES. Mr Browne previously held CFO and board positions at a number of global companies and organisations specialising in the telecommunications, technology and financial sectors including Advanced Micro Devices (AMD) in Silicon Valley, where he was responsible for running both the global financial sales and marketing operations as well as having previously been responsible for developing financial operations in countries such as China, India, Korea and Japan. Mr Browne was on the board of TomTom prior to their going public, where he was subsequently appointed Chairman. He was also Chairman of the Audit and Risk Committee of OSN in Dubai. He is Vice Chairman of the International Space University and has an MBA from Trinity College in Dublin, Ireland.

Mr Browne is an Irish national.

Mr JOHN-PAUL HEMINGWAY CEO, SES Networks

John-Paul (JP) Hemingway is the newlyappointed Chief Executive Officer of SES Networks. Prior to this, Mr Hemingway served as the Executive Vice President, Product, Marketing and Strategy of SES Networks where he led Product Management, Marketing, Business Development and Corporate Strategy and was responsible for driving the development of the company's products and vertical market segments. Before SES acquired O3b and formed SES Networks, Mr Hemingway was Chief Marketing Officer for O3b Networks, where he oversaw the company's Product Management, Product Marketing, Business Development, Marketing Communications and Strategy teams, and was integral in O3b's success. Mr Hemingway held a variety of senior management roles in the networking industry within Ciena, a leading network specialist that includes Regional General Manager Sales and Operations, Regional CTO and VP Product Management. Mr Hemingway started off his career at Corning Cables and Netscient. Mr Hemingway holds a PhD in Optical Communications and a BSc (Hons) from Manchester Metropolitan University, UK.

Mr Hemingway is a British national.

MR FERDINAND KAYSER Chief Executive Officer, SES Video

Mr Ferdinand Kayser was appointed Chief Executive Officer, SES Video in April 2017. Previously, he had been Chief Commercial Officer of SES since 2011. He is Chairman of the Board of SES ASTRA and a member of the Board of YahLive. Mr Kayser joined SES in 2002 as President and Chief Executive Officer of SES ASTRA. He has worked in senior roles in media companies such as Premiere Medien GmbH & Co. KG and CLT Multimedia. Mr Kayser holds a Master of Economics from the University of Paris 1, Panthéon-Sorbonne, and has concluded specialised university studies in Media Law and Management of Electronic Media.

Mr Kayser is a Luxembourg national.

MR CHRISTOPHE DE HAUWER Chief Strategy and Development Officer

Mr Christophe De Hauwer was appointed Chief Development Officer of SES as of 1 August 2015. He is a member of the Board of SES ASTRA. Mr De Hauwer joined SES in 2003, holding several positions of responsibility 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, Mr De Hauwer worked in the Strategy Consulting practice of the European Telecommunication and Media Industry with Arthur Andersen. He holds an Engineering and a PhD Degree from the Université Libre de Bruxelles.

Mr De Hauwer is a Belgian national.

MR MARTIN HALLIWELL Chief Technology Officer

Mr Martin Halliwell was appointed Chief Technology Officer of SES on 1 May 2011. He is a member of the Board of SES ASTRA. Mr Halliwell joined SES in 1987 after working for Cable & Wireless and for Mercury Communications. He was previously President of SES Engineering and Technical Director of SES Multimedia. Previously, he worked as SES Operations Manager and as General Manager of SES's Global Multimedia Networks. Mr Halliwell holds a Higher National Diploma in Communications and Electronics and a BA specialising in Mechanical Engineering and Mathematics from The Open University, and an MBA in External Environment and Strategic Management from the same university.

Mr Halliwell is a British national.

MR JOHN PURVIS Chief Legal Officer

Mr John Purvis was appointed Chief Legal Officer in February 2017. He has served as EVP & General Counsel of SES since 2007. John joined SES in 2001 as part of SES's acquisition of GE Americom. Previously, he had been a lawyer in GE Lighting and Rowe & Maw, a City law firm in London. Mr Purvis qualified as a solicitor of England & Wales in 1986. He holds a law degree from Jesus College, Cambridge.

Mr Purvis is a British national.

MRS EVIE ROOS Chief Human Resources Officer

Mrs Evie Roos was appointed Chief Human Resources Officer in February 2017. Prior to that, Mrs Roos held the position of Executive Vice-President Human Resources of SES. She is a member of the Board of SES ASTRA, as well as an elected member of the Luxembourg Chamber of Commerce. Before joining SES, Mrs Roos held various management positions at ArcelorMittal. She holds two degrees in Law and European Studies from the University of Leuven in Belgium and the Europa Institut in Saarbrücken in Germany.

Mrs Roos is a Belgian, Luxembourg and US national.

On 12 February 2018, the Board of Directors announced that they had accepted the decision of Karim Michel Sabbagh to step down from his role of President & CEO, with effect from 5 April 2018. Furthermore, Padraig McCarthy, CFO of SES, also informed the Board of his intention to retire and it was agreed that he would step down as Chief Financial Officer as of 5 April 2018.

On the same date, the Board announced the appointment of Steve Collar as the next President and CEO as well as Andrew Browne as next CFO with effect from 5 April 2018, with both becoming respectively CEO Designate and CFO Designate with immediate effect.

In its last meeting of the year, the Board decided to appoint John Baughn to the position of Chief Services Officer and Ruy Pinto to become the Chief Technology Officer of the company in place of Martin Halliwell who will retire after a long and distinguished career in May 2019. Until his retirement, Martin Halliwell will be Strategic Advisor to the CEO. All of these changes became effective 1 January 2019.

REMUNERATION

REMUNERATION OF THE MEMBERS OF THE BOARD OF DIRECTORS

The annual general meeting of shareholders determines the remuneration of the Members of the Board of Directors for attending Board and committee meetings. In 2018, the shareholders decided to maintain the fees paid to the directors at the previous year's level with a majority of 99.106%. Directors each receive a fixed fee of EUR 40,000 per year, whereas the Vice Chairmen each receive an annual fixed fee of EUR 48,000 and the Chairman receives a fee of EUR 100,000 per year.

A director who chairs one of the committees set up by the Board, if not the Chairman of the Board of Directors, receives an additional remuneration of EUR 8,000 per year. A director who chairs the Audit and Risk Committee, if not the Chairman of the Board of Directors, receives an additional remuneration of EUR 9,600 per year.

The shareholders also maintained the fees at EUR 1,600 for each Board meeting or Board committee meeting they attended, except for the meetings of the Audit and Risk Committee for which directors receive EUR 1,920 per meeting. 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 director participates in the meeting via telephone or videoconference.

The fees paid to the Board have not been increased since 2008, except for an increase paid to the members of the Audit and Risk Committee approved by the shareholders in 2015.

All these fees are net of any Luxembourg withholding taxes. The total net remuneration fees paid for the year 2018 to the members of the Board of Directors (net of the Luxembourg withholding tax) amounted to EUR 1,037,120 of which EUR 295,520 was paid as variable fees, with the remaining EUR 741,600 representing the fixed part of the Board fees. The gross overall figure for the year 2018 was EUR 1,329,400.

COMPANY STOCK OWNED BY MEMBERS OF THE BOARD OF DIRECTORS

On 31 December 2018, the members of

the Board of Directors and their closely associated family members owned a combined total of 765,332 shares and FDRs (representing 0.13% of the company's share capital).

Transactions made by Members of the Board of Directors are published on the company's website under Management Disclosures. In accordance with the company's dealing code, directors require prior permission before dealing in SES shares or FDRs.

REMUNERATION OF THE MEMBERS OF THE EXECUTIVE COMMITTEE

The remuneration of the members of the Executive Committee is determined by the Remuneration Committee. The total gross remuneration paid to the eight members of the Executive Committee as of 31 December 2018 amounted to EUR 6,263,464.75. It is comprised of a fixed part and a variable part. The fixed part (EUR 4,020,931.41) is composed of the base salaries (EUR 3,082,300.16) as well as the company's social security contributions, the company's pension contributions, life and disability insurance, company car and other benefits (EUR 938,631.25).The variable part (EUR 2,242,533.34) is composed of the bonuses (EUR 818,446.64), the 2018 exercised Performance and Restricted shares granted in 2015 (EUR 430,193.52), stock options that were exercised in 2018 (EUR 613,000.00) and other benefits (EUR 380,893.18). The total gross remuneration paid to the two departing Executive Committee members amounted to EUR 4,397,571.27, comprising a fixed part of EUR 467,228.11 and a variable part of EUR 3,930,343.16.

The annual bonus is composed of three elements: (i) the financial performance of the company; (ii) the individual business objectives of the Executive Committee members; and (iii) a discretionary element determined by the Remuneration Committee after reviewing the company's achievements. These three elements are weighted in the following proportions: 50%; 25%; and 25%, respectively.

The financial performance measures both the actual (current year) vs. actual (previous year) performance and the actual (current year) vs. budget (current year) performance. The metric used for the actual vs. actual performance is the reported Group EBITDA at a constant exchange rate. This metric

measures the profitable growth of the business and is also reported to investors. The actual vs. budget performance takes into account four financial metrics: revenues, operating expenses, group profit and net operating cash flow. The targets for those measures are set during the annual budget process and approved by the Board of Directors.

The individual business objectives are set at the beginning of the year by the Remuneration Committee. At year-end, the Remuneration Committee assesses in detail the performance of the Executive Committee to determine the target achievement.

During 2018, the members of the Executive Committee were awarded a combined total of 1,870,242 options to acquire company FDRs at an exercise price of EUR 12.67, the price being based on the average of the closing price on Euronext Paris of the first 15 trading days following the Remuneration Committee meeting at which the options were authorised. A quarter of 995,242 options vested on 1 January 2019, and the remaining quarters will vest on 1 January 2020, 2021 and 2022, respectively. One fifth of 875,000 options vested on 1 June 2018, and the remining four fifths will vest on 1 June 2019, 2020, 2021 and 2022, respectively. In 2018, members of the Executive Committee were granted 40,826 restricted shares as part of the company's long-term incentive plan, as well as 122,478 performance shares. These shares will vest on 1 June 2021.

The executive long-term equity plans permit the grant of three equity types: (i) stock options; (ii) restricted shares; and (iii) performance shares. The total grant value is 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 Remuneration Committee. The vesting period is over four years with a yearly vesting of 25% on 1 January of each year following the grant.

The Restricted Shares are FDRs granted to the executives with the sole condition that,

at vesting, the executive 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 the executives with two additional vesting conditions. Those conditions reflect two performance criteria, that must be fulfilled:

• 1. The compounded three years adjusted Economic Value Add (adjusted EVA) must be positive; and
• 1. Over the three-year vesting period, the personal objectives must be met and can only be one year slightly below expectations.

The adjusted EVA used for remuneration purposes has the Invested Capital reduced for the assets under construction to ensure focus of management on long-term investments.

When exercising their vested stock options and their vested shares, the executives must do this in accordance with the SES Dealing Code (including requiring the prior authorisation from the Corporate Secretary and/or Chief Financial Officer, and provide selling orders outside of a closed period). As for the members of the Board, exercises by members of the Executive Committee are reported on the SES website: https://www. ses.com/investors/shareholder-information/ shares/management-disclosures.

During 2018, Mr Martin Halliwell, Mr Ferdinand Kayser and Mr Christophe De Hauwer sold some or all of the restricted and performance shares that vested on 1 June 2018. During 2018, Mr Steve Collar exercised stock options from the 2018 stock option grant to acquire A-shares. Each member of the Executive Committee is entitled to two years of base salary in case his or her contract is terminated without cause. A member of the Executive Committee who resigns is not entitled to any compensation.

COMPANY STOCK OWNED BY MEMBERS OF THE EXECUTIVE COMMITTEE

On 31 December 2018, the eight members of the Executive Committee owned a combined total of 213,794 shares and FDRs (representing 0.04% of the company's share capital), 306,020 unvested restricted and performance shares and 3,408,569 options. Transactions made by members of the Executive Committee are published on the

company's website under Management Disclosures. Members of the Executive Committee are required to comply with the company's dealing code.

EXTERNAL AUDITOR

In accordance with the Luxembourg law on commercial companies, the company's annual and consolidated accounts are certified by an external auditor appointed by the annual general meeting of shareholders. On 5 April 2018, and based upon a proposal from the Board, the shareholders re-elected PwC as the company's external auditor for one year and approved its remuneration, with a majority of more than 98.420%. The mandate of PwC will expire at the annual general meeting on 4 April 2019.

KEY RISK AREAS

BUSINESS RISKS AND THEIR MITIGATION

This section contains a summary of the main risks that SES may face during the normal course of its business. However:

• this section does not purport to contain an exhaustive list of the risks faced by SES and SES may be significantly affected by risks that it has not identified or considered not to be material;
• some risks faced by SES, whether they are mentioned in this section or not, may arise from external factors beyond SES's control; and
• where mitigations are mentioned in this section, there is no guarantee that such mitigations will be effective (in whole or in part) to remove or reduce the effect of the risk.

1. RISKS RELATING TO PROCUREMENT

Risk of launch delays and/or launch failures SES is planning to launch four O3b satellites (on one launch vehicle) during 2019. The launch of these satellites carries a risk of delay for a variety of reasons, including the late availability of the launch service or last-minute technical problems arising on the satellites or the (Soyuz) launcher.

A launch delay or failure could have a material negative effect on revenue. Satellite launch and in-orbit insurance policies do not compensate for lost revenues due to the loss of customers or for consequential losses resulting from any launch delay or failure.

SES attempts to mitigate the risk of a launch delay interrupting existing services by leaving adequate time margins in procurement schedules for replacement satellites. SES is also currently working on the development of an integrated launch mitigation strategy based on a system of assured launches and back-ups to mitigate the risk of a launch delay.

There is always an inherent risk of launch failure resulting in a reduced satellite lifetime (in case of incorrect orbit injection), reduced functionality of the satellite or the total loss of a mission.

SES attempts to mitigate the risk of launch failure in several ways, including by detailed technical risk management of each satellite and launch vehicle programme, asset insurance for each launch and a staggered fleet deployment scheme (allowing assets to be repurposed in the case of single satellite failure to ensure a minimum impact on customers and revenues).

Risk of dependency on launch service providers

SES is currently largely dependent on Arianespace (Soyuz for O3b Block 3b and Ariane for SES-17) to launch its satellites into space. SES may incur significant delays in launching new satellites in the event of a prolonged unavailability of one of these two launch vehicles. SpaceX and/or other launch service providers may be used for future launches after SES-17.

Risk of dependency on satellite manufacturers and secondary suppliers SES is dependent on five major satellite

manufacturers for the construction of its satellites.

Dependency on a small number of satellite manufacturers may reduce SES's negotiating power and access to advanced technologies (which may only be available to certain suppliers). It may also result in a higher concentration of risk; SES may incur significant delays in procuring new satellites in the event of prolonged problems at one of these satellite manufacturers. Further, the difficulties caused by any technical problems with the design of a particular model of satellite may be multiplied if several satellites of that design are purchased.

In addition, there are a limited number of second tier suppliers of certain key components for communication satellites. SES may incur significant delays in procuring new satellites in the event of prolonged problems at one of these secondary suppliers.

SES attempts to mitigate these risks relating to procurement by a constant monitoring of its supplier base, maintaining multiple procurement sources and developing relationships with new suppliers where possible.

2. RISKS RELATING TO SATELLITES

Risk of in-orbit failure

One or more of SES's satellites may suffer in-orbit failures, ranging from a partial impairment of its commercial capabilities to a total loss of the asset. In the event of such a failure, SES may not be able to continue to provide service to some of its customers.

SES attempts to mitigate the risk of in-orbit failure by careful vendor selection and high quality in-orbit operations. SES's fleet is diversified by manufacturer and satellite type, which reduces the likelihood of widespread technical problems. The impacts of such failures on customer service and related revenues may be mitigated by an in-orbit backup strategy, pursuant to which customers on an impaired satellite may possibly be transferred to another satellite in the fleet. In addition, SES has a restoration agreement in place with another satellite operator pursuant to which customers on an impaired geostationary satellite may possibly be transferred to another satellite in that operator's fleet in order to protect continuity of service. For the MEO fleet it is possible to "pair" satellites to carry traffic following failures or, depending on the anomaly, to rebalance the customer traffic to provide continuity of service. However, there is no guarantee that these mitigations will be entirely effective, especially in the event of the failure of several satellites.

In-orbit insurance constitutes an additional financial mitigation against the risk of impairments, subject to the limitations of such insurance.

A number of SES's satellites have experienced various technical anomalies either before or during 2018.

Some of SES's satellites experiencing technical anomalies are operating beyond the end of their design lives. These satellites have already completed the primary missions for which they were designed and have been redeployed for secondary missions. Satellites in secondary missions are used for various reasons, such as developing new orbital locations, safeguarding spectrum rights and providing redundant capacity for satellites in their primary missions. These satellites' technical capabilities do not generally need to be fully utilised in operating their secondary missions, which potentially mitigates the effects of further technical failures.

The O3b satellites operate as a constellation in a non-geostationary orbit with each satellite covering a service region as it orbits the equator. Because the satellites are non-geosynchronous, each satellite provides service to all O3b customers over each complete orbit around the Earth. Accordingly, a beam failure could affect all customers using that beam in each region served by O3b, which could affect all customers and require O3b to remove the satellite or beam from commercial operation. This would reduce the number of beams or regions served by the constellation unless a spare satellite could be utilised to replace the failed satellite or beam. Three of the current 16 satellites are used as spares to provide backup for other satellites in the constellation.

Risk of short operational life

The design life of SES's geostationary satellites is typically 15 years and the design life of O3b's current satellites is 10 years. In the event of changes in the expected fuel life of the satellite, in-orbit anomalies or other technical factors, its actual life may be shorter than this. This could lead to the satellite being depreciated faster than anticipated and the lifetime revenue generated by the satellite being reduced, diminishing the overall return on investment for the asset. SES attempts to mitigate the risk of a reduced operational life by careful vendor selection and high quality in-orbit operations.

3. RISKS RELATING TO INSURANCE

Insurance coverage risk

SES's satellites may be subject to damage or loss from events that might not be covered by insurance policies. SES maintains (i) pre-launch insurance, (ii) launch and initial in-orbit insurance, (iii) in-orbit insurance and (iv) third-party liability insurance for its satellites. The insurance policies generally contain exclusions for losses resulting from:

• military or similar action;
• any anti-satellite device;
• electromagnetic and radio interference (except for physical damage to a satellite directly resulting from this interference);
• confiscation by any governmental body;
• insurrection and similar acts or governmental action to prevent such acts;
• nuclear reaction or radiation contamination;
• wilful or intentional acts causing the loss or failure of satellites; and
• terrorism.

The insurance policies do not provide compensation for business interruption, loss of market share, reputational damage, loss of revenue, incidental and consequential damages and similar losses that might arise from the loss of a satellite during transportation to the launch site or launch site operations, the failure of a satellite launch, incorrect orbital placement or the failure of a satellite to perform according to specifications. In addition, SES's in-orbit insurance only covers losses in excess of the risk retention level selected by SES.

The in-orbit insurance policies may exclude from coverage failures arising from pre-existing defects, such as defects in solar array and battery anomalies on some existing satellites. In addition, SES will not be fully reimbursed if the cost of a replacement satellite exceeds the sum insured. As a consequence, the loss, damage or destruction of any satellites as a result of any of these events could result in material increases in costs or reductions in expected revenues or both.

SES has reviewed its approach to in-orbit insurance of its satellites and, in recognition of the excellent procurement and operating record, has adopted a policy of limited selfinsurance. Premiums relating to its satellite fleet are paid to a wholly-owned subsidiary, thus reducing the amount of insurance premiums paid to external insurance companies.

If any event occurs that is covered by the in-orbit insurance, the payment of the sum insured could result in material increases in costs.

SES has third party liability insurance that covers damage suffered by third parties resulting from accidents such as launch failures and satellite collisions. It is subject to an annual combined single limit of EUR 500 million. The entire SES fleet is covered by this policy.

Insurance availability risk

Satellite insurance is a cyclical market subject to the laws of supply and demand. The amount of capacity currently available in the market is adequate to cover SES's satellite programmes. However, events outside of SES's control – including large losses and shifts of insurance capacity from space to other lines of business – could change this situation. This could result in increases in the amount of insurance premiums paid by SES to cover its risks and affect its ability to obtain the desired level of coverage. SES's self-insurance programme improves its flexibility to accommodate variations in insurance market conditions.

4. RISKS RELATING TO CUSTOMERS

Risk of key customer loss

SES depends on a number of key customers whose loss (or non-renewal) would reduce SES's revenues. SES's five largest customers represented 23.4% of SES's total revenues in 2018.

If key customers reduce their reliance on SES by developing or increasing relationships with other satellite operators, or moving to other telecommunications solutions, and such key customers cannot be replaced on time, SES's revenues may be impacted negatively.

It is important that SES's main, and long-term, satellite capacity agreements for the directto-home business in Europe are renewed on commercial terms similar to those reflected in the existing agreements. If SES would be materially unsuccessful in obtaining such renewals, revenues could be substantially adversely affected, with limited possibilities for mitigation.

SES's customer base is subject to constant change. Bankruptcy of key customers or customer consolidation resulting from mergers and acquisitions can reduce demand for SES's satellites capacity, thereby affecting SES's revenues.

Risks relating to customer credit

SES may suffer a financial loss if any of its customers fails to fulfil its contractual payment obligations.

The level of customer credit risk may

increase as SES, and/or its customers, grow revenues in emerging markets because credit risk tends to be higher in these markets (compared to the markets of Europe and North America).

This risk is mitigated principally through a customer credit policy that includes credit checks, credit profiles, deposits or other forms of security, monitoring of payment performance and the application of a provisioning policy. In some cases, customer credit risks are mitigated by credit insurance.

Further details are provided in Note [19] to the consolidated financial statements.

Risks inherent in international business

SES conducts business around the world. It is exposed to issues such as financial, regulatory, geopolitical, tax and trade risks in many jurisdictions. Political and financial stability in some jurisdictions may impact SES's business in that country. In practice, it may be difficult for SES to enforce its legal rights in some jurisdictions.

The inherent uncertainties in doing business in certain jurisdictions may have a negative impact on SES's results.

Risks inherent in doing business with the US Government

As a result of US national security laws and regulations, SES Government Solutions, Inc. is subject to a proxy agreement with the US Government ('the Proxy Agreement'). The proxy structure imposed upon SES Government Solutions is common for businesses contracting with the US Government and is similarly imposed on SES's competitors.

The US Government requires SES Government Solutions to enter into the Proxy Agreement because SES Government Solutions is indirectly owned by SES, a foreign company, and SES Government Solutions has classified contracts with the US Government. As a result of the Proxy Agreement, strict limitations are placed on the information that may be shared between SES Government Solutions and other SES subsidiaries. The Proxy Agreement also imposes restrictions on the control of SES Government Solutions by SES. However, it is important to note that inter-company activities including the provision of satellite

capacity to SES Government Solutions for provision to the US Government are permitted under the Proxy Agreement.

5. RISKS RELATING TO THE SATELLITE COMMUNICATIONS MARKET

Competition risk

The media and telecommunications market is fiercely competitive and SES faces competition from satellite, terrestrial and wireless networks.

SES faces competition from international, national and regional satellite operators. Some national operators receive tax and regulatory advantages in their countries that are not available to SES. The development of national satellite programmes in some countries may limit or prevent SES's ability to compete in those countries.

In addition, SES competes with operators of terrestrial and wireless networks. Any increase in the technical effectiveness or geographic spread of these terrestrial and wireless networks could result in a reduction in demand for SES's satellite capacity. Some terrestrial and wireless operators may receive state aid and subsidies not available to SES.

Competition in the media and communications market could result in a demand reduction for SES's satellite services and/or pricing changes resulting in a significant negative impact on SES's revenues. In the media market, changing consumer behaviour and the emergence of terrestrial technological substitution, particularly non-linear over the top services, could lead to a reduction in demand for satellite based distribution.

Technology risk

The satellite communications industry is vulnerable to technological change. SES's satellites could become obsolete due to unforeseen advances in communications technology, leading to a reduction in demand for its services and a negative impact on revenues.

The use of new technology to improve the signal compression rate could lead to a reduction in demand for SES's satellite services, which could lead to a negative impact on the financial results.

6. RISKS RELATING TO SES'S STRATEGIC DEVELOPMENT

Emerging market risk

SES's development strategy includes targeting new geographical areas and emerging markets and developing joint ventures or partnerships with local telecommunications, media and financial businesses in order to improve market access for its services.

SES may be exposed to the inherent instability of doing business in those regions. Such inherent instability could have an adverse impact on SES's revenues and operational costs.

Please also see 'Risks inherent in international business' above.

In some emerging markets, customers may be less financially secure and run a higher risk of insolvency than in more developed markets. The failure of a customer could have an adverse impact on SES's revenues.

BREXIT risk

On 23 June 2016, the United Kingdom voted to leave the EU ('BREXIT'). There is widespread uncertainty and speculation regarding what will occur as a result of BREXIT and it is difficult to predict what impact BREXIT will have on SES, although, at this time, SES does not consider it likely that BREXIT will have a significant negative impact on SES revenues.

Investment risk

SES regularly evaluates opportunities to make strategic investments. These opportunities may not yield the expected benefits due to a number of factors, such as evolving market conditions, antitrust changes, financing costs and regulatory approvals. If an investment is made, it may adversely affect SES's results due to financing costs or the economic performance of the investment following acquisition. The success of any such investment is not guaranteed.

SES has a number of strategic investments in businesses that it does not fully control. As a result, SES is dependent in part on the cooperation of other investors and partners in protecting and realising the full potential of certain investments. SES may not be able to prevent strategic partners from taking actions that are contrary to SES's business interests.

SES also invests in new and innovative projects, which often feature new and unproven technology or uncertain market demand. If the technology is not successful or demand does not materialise as planned, the economic value of SES's investment may be reduced.

SES has also earmarked certain funds for investment, which includes the replacement of existing satellites (often with increased capacity) and the launching of new satellites. The successful marketing and sale of new capacity is dependent on the underlying demand for satellite services in the targeted regional markets. If that demand does not materialise as anticipated, SES's financial forecasts may not be met.

7. RISKS RELATED TO LEGAL, REGULATORY, SPECTRUM, AND CORPORATE

Legal risk

SES cannot always predict the impact of laws, regulations and politics on its operations. The operation of the business is and will continue to be subject to the laws, regulations and political will of the various governmental authorities of the countries in which SES operates, uses radio spectrum or offers satellite capacity, as well as to the frequency coordination process of the International Telecommunication Union (the 'ITU'.) Legal, regulatory and political changes are outside SES's direct control. New or modified rules, regulations, legislation, or decisions by a relevant governmental entity or the ITU could materially and adversely affect operations.

The international nature of SES's business means that it is subject to applicable sanctions, export control, competition and anti-bribery laws and regulations including associated civil and criminal penalties. Risks concerning and violations of applicable compliance laws and regulations may negatively affect future operations or subject SES to criminal or civil enforcement actions.

Disputes in relation to SES's business arise from time to time and can result in legal or arbitration proceedings. The outcome of

these proceedings cannot be predicted. A negative outcome in a substantial litigation or arbitration case could have a material impact on SES's business and financial position.

Spectrum access risk

Access to orbital slots and frequencies is required for SES to develop and maintain its satellite fleet.

The ITU is responsible for the allocation of spectrum for particular uses, and the allocation of orbital locations and associated frequencies. Use of the spectrum and orbital positions is in accordance with the ITU Radio Regulations. SES can only access spectrum through ITU filings made by a national administration.

Orbital slots, satellite systems and associated frequencies are a limited resource. The ITU may reallocate spectrum from satellite to terrestrial or other uses. In addition, national administrations are increasingly charging for access to spectrum by the use of fees and auctions.

Any reallocation of spectrum from satellite to terrestrial or other uses or fees and charges assessed by national administrations may have a significant adverse effect on SES's current results and future prospects.

Spectrum coordination risk

SES is required to coordinate the operation of its satellites with other satellite operators through the relevant national administrations and in accordance with the ITU process so as to prevent or reduce interference between satellites. SES may also be required to coordinate any replacement satellite that has performance characteristics that differ from the satellite it replaces.

As a result of such coordination, SES may be required to modify the proposed coverage areas of its satellites, satellite design or transmission plans in order to eliminate or minimise interference with other satellites or ground-based facilities. Those modifications may mean that use of a particular orbital position is significantly restricted, possibly to the extent that it may not be economical to place a new satellite in that location. In addition, interference concerns of a country may affect the ability of SES's satellite network to generate revenues, due to the operational restrictions that the country may impose.

Similarly, the performance of SES's satellites in the affected areas could be adversely affected if ITU regulations or other legal constraints fail to prevent competing satellite operators from causing harmful interference by the operation of their satellites.

Spectrum use risk

If SES does not occupy unused orbital locations by specified deadlines, does not maintain satellites in the orbital locations it currently uses or does not operate in all the frequency bands for which a licence has been received, then, in accordance with applicable national and ITU regulations, those orbital locations or frequency bands may become available for use by other satellite operators.

SES has access to a large portfolio of orbital locations that have been filed at the ITU through various administrations. For each filing, the ITU and the national regulators impose various conditions that must be met in order to secure the spectrum. Operational issues such as satellite launch failure, launch delay or in-orbit failure might compromise the access to the spectrum or orbital locations. SES is committed to the highest quality satellite and launch procurement processes, which helps to reduce this risk. In addition, SES's large fleet of satellites may in some circumstances permit the relocation of in-orbit satellites in order to meet regulatory requirements.

Regulatory risk

SES may need to obtain and maintain approvals from authorities or other entities to operate its satellites and to offer satellite capacity. For example, SES must obtain licences, authorisations or market access approvals in certain countries to enable provision of satellite capacity to those countries. The failure to obtain the licences, authorisations or market access approvals necessary to operate satellites or to offer satellite capacity could lead to loss of revenues and compliance actions against SES.

Each customer is responsible for obtaining regulatory approval for its operations. As a result, there may be governmental regulations inapplicable to SES that may adversely affect customers' operations. SES could lose revenues if customers are unable to obtain any necessary approvals,

if customers' regulatory approvals are insufficient in the view of the relevant regulatory authorities, if the necessary approvals are not granted on a timely basis or if any applicable licencing restrictions become unduly burdensome.

Export control

SES must comply with US export control laws in connection with any US information, products or materials that it provides to non-US companies relating to communications satellites, equipment, software and data. SES's US operations may not be able to maintain normal business activities and SES's non-US operations may not be able to source US satellites, hardware, technology and services if:

• export licences are not timely obtained;
• export licences do not permit transfer of all items requested;
• satellite launches are not permitted in the locations that SES prefers; or
• the requisite licence, when approved, contains conditions or restrictions that pose significant commercial or technical problems.

Such occurrences could impede construction and delay the launch of any future satellites, adversely impacting current and/or future revenues. SES must also comply with other applicable national export laws and regulations.

External threat risk

In common with other satellite operators, SES is vulnerable to the risk of terrorist acts, sabotage, piracy, attack by anti-satellite devices, jamming, unintentional interference and natural disaster. Such external threats may lead to a temporary or permanent interruption in service and/or the loss of customers. Any such act could have a potentially significant adverse effect on SES's results.

Cyber risk

SES's operations may be subject to hacking, malware and other forms of cyber-attack. Due to the fast-moving pace of new hacking techniques, the high sophistication of certain attackers and an increasingly hostile cyberattack environment, it may be difficult to detect, determine the scope of, contain and remediate every such event.

Any inability to prevent or to detect the occurrence of cyber-attacks in a timely manner could result in a disruption of services or malfunctions, loss of customers, inadvertent violations of data protection, export control and other relevant laws, damage to SES's reputation, or damage to SES's properties, equipment and data. Furthermore, such event could result in large expenditures necessary to repair or replace such networks or information systems or to protect them from similar events in the future.

SES has protections in place to help protect its networks and continues to work to implement additional protective measures intended to limit the risks associated with such attacks.

People-related risk

SES is competing for talent with large and well-known companies. In the context of low unemployment rates and a shortage of qualified candidates, SES may have difficulties in finding and onboarding diverse and competent talent with the required capabilities. SES attempts to mitigate this risk through the creation of a dedicated Talent Acquisition function, to enhance the sourcing of high-quality candidates, improve the applicant experience, and network more effectively with partners (universities, professional networks, recruitment agencies, referral programmes), as well as strengthening our Employer Brand.

Through its internal Learning and Development programmes, SES fosters the retention and in-house development of talent (Associate Programme, Leadership Programme, Mentoring Programme, Learning and Career Progression Opportunities) in order to reduce the risk of losing key contributors.

In addition, SES continues to nurture a high-performance culture founded on jointly endorsed behaviours aligned around a clear purpose and vision, helping teams to focus and remain energised in order to deliver on its customer promise.

If SES is unable to source, onboard, energise and retain key talent, it could have a negative impact on SES's business, financial situation and results.

Unforeseen high impact risk

SES's operations may be subject to unforeseen events that are both improbable and have a high impact. Due to the unforeseen nature of the event, it is difficult to manage the impact of such events or predict the nature or extent of the damage. Such unforeseen events may have a significant negative impact on SES's business, financial situation and results.

8. RISKS RELATING TO FINANCE

Economic downturn risk

An economic slowdown in the countries where SES operates may have a negative effect on its performance if potential customers face difficulties funding their business plans. This could, in turn, result in decreased profitability, with significant negative consequences for SES's business, financial condition and results of operations.

Cash flow risk

SES operates in accordance with a strong business model. If, for any reason, SES is not successful in implementing its business model then cash flow and capital resources may not be sufficient to repay indebtedness. If SES were unable to meet its debt service obligations or comply with covenants, then a default under debt agreements would occur. To avoid a possible default or upon a default, SES could be forced to reduce or delay the completion or expansion of the satellite fleet, sell assets, obtain additional equity capital or refinance or restructure its debt.

Debt rating risk

A change in SES's debt rating could affect the cost and terms of its debt, as well as its ability to raise financing. SES's policy is to attain, and retain, a stable investment grade rating with Standard & Poor's and Moody's. If SES's credit rating were downgraded, it may affect SES's ability to obtain financing and the terms associated with that financing. SES cannot guarantee that it will maintain its investment grade credit ratings.

Tax risk

SES's financial results may be materially adversely affected by unforeseen additional tax assessments or other tax liabilities.

SES does business in many different countries and is therefore subject to taxation in multiple jurisdictions. SES makes provisions in its accounts for current and deferred tax assets and liabilities based on a continuous assessment of prevailing tax laws in those jurisdictions.

However, SES cannot always be certain of a tax authority's application and interpretation of the tax law. SES may become subject to unforeseen material tax claims, including late payment interest and/or penalties. Such claims may arise for a number of reasons, including: the identification of a taxable presence of a non-indigenous group company in a taxing jurisdiction; transfer pricing adjustments; application of indirect taxes on certain business transactions after the event; and the disallowance of the benefits of a tax treaty. In addition, SES may be subject to retroactive tax assessments based on changes in laws in a particular tax jurisdiction. SES has implemented a tax risks mitigation charter based on (among other things) a framework of tax opinions for the financially material positions taken, transfer pricing policies and documentation covering the group's important inter-company transactions, and procedures for accurate tax compliance in all jurisdictions.

Asset impairment risk

SES's non-current intangible and tangible assets are valued at historic cost less amortisation, depreciation (where relevant) and accumulated impairment charges. The resulting net book values are subject to validation each year through impairment testing procedures, where they are compared to the value-in-use of the asset, representing the 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.

In the SES S.A. annual accounts, impairment testing – using value-in-use procedures similar to those outlined above – is performed on the carrying value of the shares in affiliate undertakings, or on the carrying value of groups of shareholdings where the Board of Directors believes that it is more appropriate under the circumstances, and better reflects the substance of the activities, the interdependency of the associated cash

flows and their level of integration. If the carrying value of the relevant investment, or group of investments, is not substantiated by its value-in-use, and any shortfall is assessed as being other than a temporary nature, then this could result in an impairment charge being recorded to the income statement of the SES S.A. annual accounts in the period concerned.

Liquidity risk

SES requires liquidity to maintain its operations and meet its obligations. Any liquidity problems may have a significant impact on SES's operations and lead to the breach of contractual obligations. In case of liquidity needs, SES can call on a number of committed and uncommitted credit facilities with banks. In addition, if deemed appropriate based on prevailing market conditions, SES can raise funds through its European Medium-Term Note programme or other debt capital market instruments. SES's debt maturity profile is tailored to allow the company to cover repayment obligations as they fall due. SES operates a centralised treasury function, which manages the liquidity of SES and seeks to optimise the funding costs. This is supported by a daily cash pooling mechanism.

Further details are provided in Note [19] to the consolidated financial statements.

Foreign currency risk

SES's reported financial performance can be impacted by movements in the US dollar/ euro exchange rate, as SES has significant operations where the functional currency is the US dollar and assets and liabilities are denominated in US dollar.

To mitigate this exposure, SES may enter into forward foreign exchange or similar derivatives contracts to hedge the exposure on financial debt or on the net assets.

Further details are provided in Note 19 to the consolidated financial statements.

Interest rate risk

SES's exposure to the risk of changes in market interest rates relates primarily to SES's 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. The terms of such derivatives are negotiated to match the terms of the hedged item to maximise the effectiveness of the hedge.

Further details are provided in Note 19 to the consolidated financial statements.

Counterparty credit risk

SES's exposure relates to the potential default of a counterparty holding financial assets (cash and cash equivalents held for trading financial assets, loans, receivables and derivative instruments).

The counterparty credit 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, SES only deals with recognised financial institutions with an appropriate credit rating. All counterparties are financial institutions that are regulated and controlled by the national financial supervisory authorities of the applicable countries. The counterparty credit 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 relationship for all categories of products (derivatives as well as deposits).

Further details are provided in Note 19 to the consolidated financial statements.

INTERNAL CONTROL PROCEDURES

OBJECTIVE

The Board has 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 the company.

Internal control procedures help to ensure the proper management of risks and provide reasonable assurance that the business objectives of the company can be achieved. The internal control procedures are defined and implemented by the company to ensure:

• the compliance of actions and decisions with applicable laws, regulations, standards, internal rules and contracts;
• the efficiency and effectiveness of operations and the optimal use of the company's resources;
• the correct implementation of the company's internal processes, notably those to ensure the safeguarding of assets;
• the integrity and reliability of financial and operational information, both for internal and external use;
• that management's instructions and directions are properly applied; and
• that material risks are properly identified, assessed, mitigated and reported.

Like all control systems, internal controls cannot provide an absolute guarantee that risks of misstatement, losses or human error have been totally mitigated or eliminated.

CONTROL ENVIRONMENT

SES has adopted a robust internal control framework based on a set of guidelines prepared by COSO (Committee of Sponsoring Organisations of the Treadway Commission). This 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 control environment is an essential element of the company's internal control framework, as it sets the tone for the organisation. This is the foundation of the other components of internal control, providing discipline and structure. The Board has delegated the design, implementation and maintenance of a rigorous and effective

system of internal controls to the Executive Committee of SES, which in turn works closely with the other levels of management in establishing control policies and procedures.

Policies and procedures are regularly updated, as appropriate. The aim is to design and implement a common set of policies and procedures that best support the organisation and can be used companywide. The policies and procedures apply to all employees and officers of the SES group, and where appropriate, to its directors as the general framework for their own business process design. The policies and procedures take into account specificities of each business unit and legal entity and are adapted where necessary to their activity, size, organisation and legal and regulatory environment.

A group-wide 'Code of Conduct and Ethics' has been in place since 2009. The Code is designed to enable all employees, officers and directors to take a consistent approach to integrity issues and to make sure that SES conducts its business in compliance with all applicable laws and regulations and observes the highest standards of business ethics.

An SES Compliance Committee, composed of designated Compliance Officers in each main corporate location, is tasked with raising the staff's awareness of the Code and ensures a consistent roll-out and training programme for the Code. The Committee meets regularly to discuss important topics or issues. Reflecting the company's expansion into developing markets, the composition of the Compliance Committee includes representatives from SES's offices in Asia, the Middle East and Latin America.

During the course of 2018, SES has introduced a whistleblowing hotline, managed by a third-party provider, which allows its staff to file any compliance complaints in full confidence.

The major focus of 2018 compliance trainings has been on GDPR, cybersecurity and antibribery. Overall more than 3,100 staff have been trained on various compliance topics. A wider training plan is under preparation. To ensure better compliance with data protection laws and regulations, SES appointed a Group Data Protection Officer

in 2014. SES has implemented a variety of measures, reviewed and updated procedures and processes to ensure compliance with the General Data Protection Regulation (GDPR).

The descriptions of the main SES functions and processes are electronically documented. Given many ongoing updates and changes in the processes and systems, SES has now started to standardise its mapping using a common Business Process Management software.

Another key component of the control environment is the coordination of risk management with internal control. Risk management and internal control systems complement each other in controlling the company's activities.

RISK MANAGEMENT

SES has adopted a risk management framework based on principles proposed by COSO and ISO31000. The coordination of the implementation of this policy and regular preparation of risk management reports is the responsibility of a Risk Management Committee that reports to the SES Executive Committee. The Executive Committee 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.

Common definitions and measures of risk management have been established and provided to the various risk owners to ensure that the risk management policy is properly implemented. Each reported risk is categorised, assessed by the risk owners and reviewed by the Risk Management Committee. A risk management coordinator has been appointed in order to ensure the adequate review of the risks facing SES and an overall implementation of the risk management policy and procedures by the Risk Management Committee. Key risk developments are periodically reported to the Executive Committee, the Audit and Risk Committee and the Board.

INTERNAL CONTROL ACTIVITIES

Regarding the internal controls in the area of accounting and financial reporting, the following should be noted:

• Staff involved in the company's accounting and financial reporting are appropriately

qualified and are kept up-to-date with relevant changes in International Financial Reporting Standards ('IFRS'). Additionally, specific training and written guidance on particular matters is provided where needed. Written guidance, regularly updated for business developments and regulatory changes, is available to all relevant staff members and provides a summary of the company's accounting and financial reporting policies and procedures.

• Controls have been established in the processing of accounting transactions to ensure appropriate authorisations for transactions, effective segregation of duties and the complete and accurate recording of financial information.
• Completeness and timely recording of financial information is ensured through regular reviews, monitoring of specific key performance indicators, validation procedures by functional leaders and as an additional check, the process of internal and external audit.
• In accordance with the requirements of IFRS, 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 information and oversight. Strategic plans, business plans, budgets and the interim and full-year consolidated accounts of the company 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 financial performance in comparison to the approved budget and prior year figures.
• Any material weaknesses in the system of internal controls identified by either internal or external auditors are promptly and fully addressed.
• The external auditors perform a limited review of the company's half-year consolidated financial statements and a full audit of the annual consolidated financial statements.

Regarding the internal controls in the area of treasury management, the following should be noted:

• The treasury function uses specific software that helps to ensure the efficiency and control of the implementation of

SES's hedging strategy for interest rate and foreign currency fluctuations. This software also aims to centralise the cash management of SES's affiliates.

• In order to ensure enhanced security and efficiency of the bank payments process, the company is using a banking payments system that allows for secured authorisation and transfer of payments from the SAP accounting system directly to the bank.
• A clear segregation of duties and assignment of bank mandates between members of SES management, treasury and accounting departments has been implemented.
• In order to streamline the cash management process, SES has centralised the in-house bank into one hub. This inhouse banking system is fully integrated and managed in SAP.
• SES predominately uses forward currency contracts to eliminate or reduce the currency exposure on single deals, such as satellite procurements, tailoring the maturities to each milestone payment. Such foreign currency risk is predominantly in EUR or USD. 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 company's policy to not enter into forward contracts until a firm commitment is in place, and to match the terms of the hedge derivatives to those of the hedged item to maximise effectiveness.
• Those treasury activities with a significant potential risk, such as financial derivative transactions with external parties and in particular the hedging activities engaged during the year, are authorised within the framework approved by the Board.
• A short treasury report is issued every quarter to the Board as part of the financial reporting.
• To further strengthen these controls, a treasury policy is regularly updated. In addition, a Treasury Roadmap based on SES's strategic and business plans, is also prepared and presented to the Audit and Risk Committee.

Regarding the internal controls in the area of tax management, the following should be noted:

• The main principles of SES's tax risk management are laid down in the SES Tax Charter. Tax positions are analysed based on the most appropriate authoritative interpretations and reported in internal tax technical memos or tax opinions from external tax consultancy firms. The tax department seeks, where possible, to achieve upfront tax clearances with relevant local tax authorities with regard to the tax ramifications of main business ventures, corporate reorganisations and financing structures of the company.

• Current and deferred tax liabilities are recorded in the SES group accounts on the basis of a key control framework that ensures full transparency and understanding of all underlying data and reconciliation between the important sources of information within the tax and accounting departments.
• The transfer pricing team is responsible for continuously updating and improving transfer pricing documentation underpinning all significant cross-border inter-company transactions in the company through functional and economic analyses including benchmarking studies. SES's transfer pricing documentation includes a master file, local files and a country-by-country report.

Regarding the internal controls in the area of satellite operations, the following should be noted:

• SES's Technology Department is responsible for the procurement of satellites and launch vehicles, the procurement and maintenance of satelliterelated ground infrastructure and the administration, control and operations of the satellite fleet.
• The reporting of the satellite procurement and operations risk management process that is in place to monitor and assess sources of technical risks and to develop qualitative, quantitative and statistical methods which allow the mitigation of risk at the satellite fleet level has been integrated into the company's Risk Management framework.
• The operational procedures for satellite control and payload management 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. These procedures are periodically reviewed

to ensure that they are up-to-date. Satellite control software is being used and fully validated electronic procedures for station-keeping and other regular operations are being applied throughout the entire SES fleet.

• SES has designed crisis management systems and supporting infrastructure and tools in order to address satellite in-orbit anomaly situations at an appropriate management level. SES incorporates industry standard incident management, escalation and reporting processes to provide effective and timely support to customers.
• The Satellite Contingency and Emergency Response Process reflects the company's current organisational structure.
• For LuxGovSat, a highly secured Network Operation Centre ('NOC') was constructed on the Betzdorf campus in 2017.

SES has adequate satellite control primary and backup capabilities utilising the European and US-based Satellite Operations Centres ('SOCs'). A SOC was built in Brazil to control the SES-14 satellite, with Betzdorf having the ability to control it. The Brazilian SOC is now operational.

For SES Geostationary satellites:

• Primary satellite operations in Europe are operated from the technical facility in Betzdorf and the SOC in Gibraltar.
• Primary satellite operations in North America are operated from the SOC in Princeton.
• Satellite engineering and Flight Dynamics tools, applications and documentation required to support satellite operations are available in the Betzdorf and Princeton Data Centres.
• SES has adequate satellite control backup capability utilising the European and US SOCs.
• The fail-over procedure from Primary to Backup SOC is tested regularly. The backup SOCs in Woodbine and Redu are tested twice a year.

For SES Medium Earth Orbit ('MEO') located satellites (O3b), primary satellite operations are performed from the O3b/MEO SOC in Betzdorf and backup satellite operations are performed from the O3b/MEO SOC in Manassas (US).

For SES Infrastructure Redundancy, adequate backup capabilities are implemented.

Regarding the internal controls in the area of information technology, the following should be noted:

• Management is committed to ensuring that SES's 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 in order to ensure compliance with the General Data Protection Regulation (GDPR).
• Management is committed to enhancing information security through the established Data Governance and Information Security Committee within SES, comprising representatives from various applicable functions, which reviews practices, policies and procedures.
• SES has rolled out its information security and cybersecurity framework across business units and is in the process of aligning security controls and practices within the SES group
• Electronic information is regularly backed up and copies are stored off-site.
• SES has disaster recovery plans for its business applications. The regular testing of these activities is confirming that SES is in a good position to recover all mission critical back-office applications within their set recovery time objectives.

INFORMATION AND COMMUNICATION

All SES's main trading operations are included and operated on a common SAP platform, sharing common IT processes and controls.

A comprehensive SAP security policy has been defined and implemented. This ensures that appropriate SAP access management is in place and is continually enhanced. It also leverages off the implemented SAP Governance Risk and Compliance module, which focuses on access and process controls.

The operation of the SAP hosting platform continues to mature in various areas including data privacy, data encryption and intrusion detection as annually confirmed in the Statement on Standards for Attestation Engagements (SSAE) report provided by the hosting company. A detailed operational handbook is maintained to safeguard the smooth and secure operation of the company's ERP platform. In 2017, the hosting company has commissioned a new stateof-the-art backup data centre to ensure enhanced continuity of the SAP system operations.

Internal communication ensures the effective circulation of information and supports the implementation of internal control and risk management by providing business and functional objectives, instructions and information to all levels of SES. The corporate intranet portal and collaboration tools are instrumental to sharing information throughout the company.

MONITORING ACTIVITIES

Monitoring is done in two ways: through ongoing evaluations or separate evaluations. Ongoing evaluations 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 separate evaluations of the relevance of, and compliance with, company policies and internal control procedures.

The mission of the Internal Audit function is to provide independent and objective assurance regarding the effectiveness and efficiency of business operations, the reliability of financial and operational reporting, and the company's compliance with legal and regulatory requirements. In this context, Internal Audit is also tasked to support management with identifying, preventing and minimising risks, as well as safeguarding the company's assets.

To ensure an appropriate level of independence and communication, the Internal Audit function has a direct reporting line into the Audit and Risk Committee and functionally reports to the President and CEO.

The activities of the Internal Audit function are executed in accordance with an annual audit plan, which is reviewed and approved by the Audit and Risk Committee. This plan is derived from an annual risk assessment based on a risk mapping exercise relying on the SES risk register. The annual risk assessment responds to the need to dynamically link the audit plan to risks and exposures that may affect the organisation and its operations.

Internal Audit monitors the implementation of internal control recommendations and regularly reports on effective compliance to the Senior Management of SES and to the Audit and Risk Committee.

Internal Audit also regularly coordinates audit planning and exchanges relevant information with the company's external auditors.

The proxy structure of the SES Government Solutions entity, in line with common practice for businesses serving certain segments of the US Government, 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. The SES Internal Audit function did not perform any direct internal control review of this entity during 2018, in line with the imposed restrictions. However, these restrictions are mitigated through having agreement on a required risk management and internal control framework for SES Government Solutions that is subject to evaluation and testing by a third-party internal audit function. An adequate reporting process of activities of the third-party audit function to the SES Internal Audit function and the Audit and Risk Committee has been put in place.

It should be further noted that PwC, as external auditor, reviews the financial statements of SES Government Solutions.

INVESTOR RELATIONS

SES's dedicated Investor Relations function reports to the Chief Financial Officer and works closely with the President and 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 audiences, to monitor stock market developments, and to provide feedback and recommendations to the SES Executive Committee. The VP, Head of Investor

Relations, is responsible for the definition and execution of SES's active Investor Relations programme and participation 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.

ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG)

The concept of Environmental, Social and Governance (ESG) is used to identify how a company's values and conduct demonstrate responsibility towards the communities and societies in which it operates. Environmental criteria look at how a company performs as a steward of nature. Social criteria examine how a company manages relationships with its employees, suppliers, customers and the communities where it operates. Governance deals with a company's leadership, executive pay, audits, internal controls and shareholder rights.

Our ESG activities go beyond compliance with the compulsory legal elements and include self-defined targets. SES has made a number of commitments in this domain and defined its best practices. This results in notable recognition by stakeholders, investors, customers and employees, and an excellent reputation as a corporate citizen. In addition to complying with the existing framework, SES voluntarily discloses supplementary and non-financial information – via this current report – beyond what is required by the EU directive 2014/95, which had become mandatory for reporting in 2018.

We will publish a separate ESG Report on SES's website by 30 June 2019. This document will include all non-financial and diversity disclosures required by the Law of 23 July 2016, implementing the European Directive 2014/95/EU, regarding the publication of non-financial and diversity information in Luxembourg.

At SES, we are committed to operating our business in a socially responsible way. We take this responsibility seriously and define ambitious objectives for how we approach the environmental and ecological profile of the business, our educational contributions, charitable activities, human resource management and corporate strategy.

ENVIRONMENTAL

We apply best practices in minimising the environmental impact of our sites across the world. We also ensure that the amount of radiation emitted from earth stations respects or remains below the maximum levels defined by the countries of operation. The company's compliance with this is checked through yearly audits that are conducted both by internal and by thirdparty accredited organisations that specialise in the field of industrial safety.

Since 2008, we have officially reported the CO2 emissions of our operations through participation in the Carbon Disclosure Project (CDP), which collects the data of all SES's business activities and locations.

The data collection for CDP covers three scopes:

• Scope 1: Direct Combustibles (gas and fuel consumption, refrigerant leakage, car fleet)
• Scope 2: Indirect Energy consumption (purchased electricity or heat)
• Scope 3: Other Emissions (business travel, commuting, waste, water consumption)

In 2017, the company's activities related to operating and commercialising SES's satellite fleet, as well as general administration, finance and marketing, generated approximately 46,883 tons of CO2 emissions worldwide, an increase of 15% compared to 2016.

Scope 1 emissions increased by approximately 5.4%, or 99 tons. Scope 3, business travel including staff commuting, increased by 3,649 tons to 37.08% overall. This increase was due to the growth of the company in number of employees and sites.

The methodology used follows as closely

as possible the guidelines outlined in the Greenhouse Gas (GHG) Protocol Corporate Accounting and Reporting Standard and Defra (UK) Guidance on How to Measure and Report your Greenhouse Gas Emissions (September 2009) and the International Energy Agency's 2017 edition of CO2 emissions from fuel combustion and World energy balances database.

Emissions from Scope 2, electricity consumption, represented the largest component of SES's total emissions (approximately 57.5%). Scope 2 locationbased 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 circulated to all 42 main SES global sites in order to collect activity data. 58 low occupancy and 71 unmanned SES sites ('co-locations') 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, we started to analyse the energy efficiency of the main facilities in accordance with EN 16247. This audit was first performed at SES's site in Munich, Germany, and in 2016 at the headquarters site in Betzdorf, Luxembourg with the goal to identify energy saving potential for further optimisation.

Through these and other initiatives, we have thus implemented a substantial and ongoing carbon reduction plan in our sites across the world.

SES Group CO2 results

Total emissions (t CO2)	46,883	40,856	42,336	35,087	38,768	33,307	39,159	41,553	49,788	40,939
Scope 3 (t CO2e)	17,386	13,737	12,486	11,460	14,756	5,873	4,937	2,309
Scope 2 (t CO2e)	26,980	24,701	24,395	17,080	17,391	20,475	27,758	26,846	32,471	26,507
Scope 1 (t CO2e)	2,517	2,418	5,455	6,546	6,621	6,959	6,464	12,397	17,317	14,432
Year	2017	2016	2015	2014	2013	2012	2011	2010	2009	2008

SOCIAL

EDUCATION

Our education initiatives are based on collaborations and partnerships across the world. We partner with universities to foster technological innovation, contribute to the development of mission-critical technical capabilities, advance satellite-based business solutions, develop engineering and legal talent, encourage legal research and support PhD research.

ACADEMIC PARTNERSHIPS

Our academic partners include:

• Luxembourg Institute of Science and Technology (LIST)
• Center for Security, Reliability and Trust (SnT) at the University of Luxembourg
• The Faculty of Law, Economics and Finance (FDEF) at the University of Luxembourg
• Jack Welch College of Business, Sacred Heart University, Luxembourg
• Massachusetts Institute of Technology (MIT)
• Lycée Technique d'Esch-sur-Alzette (LTE), Esch-sur-Alzette, Luxembourg
• The International Space University, Strasbourg, France
• Université Paris-Sud, France
• Politehnica University of Bucharest, Bucharest, Romania
• Stevens Institute of Technology, New Jersey, US
• Princeton University, Princeton, US
• African School of Economics (ASE), Abomey-Calavi, Benin

In 2018, our partnership with the Luxembourg Institute of Science and Technology (LIST) continued to progress towards developing a European Centre of Excellence to address societal challenges such as climate change, environment, green mobility, security and healthcare in addition to other satelliterelated application areas, such as connected cars. SES and LIST continue to work on developing commercial applications in the areas of Internet of Things (IoT), e-platform solutions and optical communications.

The cooperation framework with LIST complemented our existing partnership agreement with the Interdisciplinary Center for Security, Reliability and Trust (SnT) at the University of Luxembourg, where we also finance a chair in Satellite, Telecommunications and Media Law within the Faculty of Law, Economics and Finance.

Our cooperation through our international network of research partners with unique expertise in satellite communications (SatCom) is aimed at transforming basic research into innovative space applications. LIST is therefore a close technology partner in the development of pioneering SatCom commercial products and services.

In addition, this partnership agreement further enhances Luxembourg's technology ecosystem by attracting start-ups to develop their businesses in Luxembourg, and will facilitate the transfer of new technologies stemming from national public and private research.

Those activities are conducted in close coordination with the existing national funding initiatives, such as the Digital Tech Fund, of which we are a key stakeholder. The current focus of research is the 'Smart Space' initiative, which includes research and development of applications in the context of High Performance Computing (HPC), aiming to establish a unique space ecosystem by building on Luxembourg's competitive advantages, including global satellite communications and telecommunications networks, data centres and connectivity and existing service providers.

Our cooperation agreement with Sacred Heart University Luxembourg covers both educational services for SES employees and student visits. We also provide ongoing funding for a scholarship programme at the International Space University (ISU) in Strasbourg, France, to support students studying advanced space applications.

In Benin, we fund scholarships for students from the African School of Economics (ASE) to attend Princeton University, another one of our partners in the US. In the US, we also support the Master's Programme at the Stevens Institute of Technology, a coeducational research university located in Hoboken, New Jersey.

e-LEARNING

e-learning can change lives whereby quality education can be delivered to even the most remote locations. As the world's leading satellite-enabled solutions provider, we are

the ideal partner to empower communities and people everywhere on the planet. Our e-learning initiatives bring education and knowledge-sharing solutions, as well as provide internet connectivity that works to bridge the digital divide, fuel economic growth and foster societal development.

Whilst our e-learning programmes are deployed across the world, in the last few years we have focused our efforts on the African continent, where satellite technology is best-placed to reach rural and isolated areas. We have therefore worked with governments and public institutions in Africa to encourage them to embrace satellite technology to accelerate an education development programme.

This has initiated broadband policies that address digital inequality, promote investment in infrastructure, and encourage economic and social development.

In Nigeria, we have leveraged our satellite technology and infrastructure to run e-learning programmes since 2015. By partnering with the Nigerian Government to implement a number of Information and Communications Technology (ICT) projects, we are bridging the digital and information gap that exists in rural areas and providing more e-learning facilities to underserved communities.

e-learning can mean that students around the world can access courses in any field, and governments or institutions can generate programmes aimed at specific learning goals.

SCIENCE, TECHNOLOGY, ENGINEERING AND MATHEMATICS (STEM)

We must inspire the new generation towards Science, Technology, Engineering and Mathematics (STEM) and so we engage in global activities in this field. As we promote STEM, we also ensure this is done around principles of diversity. In particular, we encourage gender diversity in engineering.

SES Space Scholarships

In May 2018, we teamed up with The Air League to create the first ever SES Space Scholarship. The Air League was founded in 1909 and is a charitable organisation based in the United Kingdom. The Patron of The Air League is Prince Philip, Duke of Edinburgh. The Air League Trust is currently the major

provider of powered flying, ballooning, gliding and engineering scholarships and bursaries to young people and disabled veterans.

The SES Space Scholarship is a unique opportunity for students who are between 17 and 18 years old, are interested in the space industry and have completed their studies to take part in a residential Senior Space School with the University of Leicester in the UK held every August. The scholarships are designed to introduce and inspire the individual towards the wide range of career opportunities in the space industry.

YWCA Princeton Robotics

In promoting gender diversity in STEM, our office in Princeton (United States) has actively supported YWCA Princeton Robotics with teams since 2016, and part of the cafeteria in the Princeton SES office has been turned into a robotics workshop where the participants build and test robots. This activity has also resulted in hiring of summer interns.

The two YWCA Princeton all-girls competitive robotics teams – Robotics Rockettes and Prototype G – whose members were 12-16 years of age, visited the SES facility in Princeton to demonstrate their work, and a tour of the Space Operations Center. After their presentation to the SES scientists and management, the girls had the opportunity to explore SES's satellite operations with some of our engineers, and learn about how satellites are launched and controlled from the ground. The day ended with a discussion with the female leaders at SES, who spoke candidly to the girls about how they have managed to combine their passions and expertise to have strong careers in male-dominated industries. After all, empowered women empower women.

Prototype G has been invited by other teams to mentor them in theoretical programming and the creation of the engineering notebooks, as well as to mentor a FIRST Global Team. They won the Connect Award, reached the 3rd place for the Inspire award, twice won the Think Award and were a finalist for the Alliance Award multiple times. During 2017-2018, Robotic Rockettes were nominated for both the Connect and Think awards and they won the Motivate Award while coming in second for the Inspire Award. They were also nominated for the Connect

Award during the 2017 and the 2018 New Jersey State Tournaments.

SES and Massachusetts Institute of Technology (MIT) Career Events

The partnership between SES and the Massachusetts Institute of Technology (MIT) extends beyond research projects to also include recruiting efforts. In 2018, SES colleagues participated in two events held on the MIT campus. The first event in May saw students from the Aeronautics, Electrical & Mechanical Engineering, Computer Science, and Physics departments invited to a recruiting lunch-n-learn seminar that included presentations and a discussion on our talent acquisition process.

A second career and recruitment event was held in September for Graduate and Postdoc Students.

Both events on the MIT campus established long-term recruitment prospects for SES.

Engineering Trainee Days

In October, during the All Saints school holidays, we hosted the fifth edition of Engineering Trainee Days on SES's Betzdorf Campus (Luxembourg) with students aged 15-18 years from across Luxembourg.

The Engineering Trainee Days is an initiative of Luxembourg's engineering association, the Association Luxembourgeoise des Ingeniéurs (ALI), and the association for young entrepreneurs, Jonk Entrepreneuren Luxembourg, in cooperation with the Ministry of Education and Lifelong Learning.

The workshop featured the 'Stakeholders Centricity - Monumentum Wall' and interactive presentations on SES and the space sector. The Engineering Trainee Days 2018 was particularly appreciated by the participants, as it provided an opportunity to network with industry professionals, broaden their horizons and discover new career opportunities.

GOVERNANCE

DIVERSITY AND INCLUSION

We are committed to bringing together an SES team of diverse individuals with different life experiences, different backgrounds, and from different geographies and cultures.

This approach is paramount to serving our customers today and helping us decipher the world's communication needs of tomorrow. By actively nurturing an inclusive company culture, and appreciating why it is so important to create a fair and supportive work environment for our people, we seek to continue attracting and retaining the very best talent.

We acknowledge that there is much work still to be done, as indeed work must be done in the technology sector as a whole. As an industry leader, SES is fully committed to increasing the number of colleagues from underrepresented groups and to creating a more diverse SES for the future.

We began by analysing and addressing drivers for female inclusion, which is an approach that is also used to maximise the commitment of all diverse groups in our workforce. Currently SES's workforce consists of 24% women, a figure that has been stable over the last four years but that we expect to grow as part of our diversity strategy. Also, whilst currently 9% of our executives are female, about 27% of our employees below 30 years are female, of which 27% of them are on the executive succession plan and 21% are participants in SES's High Potential Programme.

We are determined to continue to increase the number of women in areas where they are underrepresented and to increase the number of female executives by 2020. In order to achieve this goal, we will introduce systematic and supportive practices in building a female talent pipeline that will sustain long-term gender inclusion.

As of 31 December 2018, the Group employed 2,147 individuals worldwide (counted in full time equivalents [FTEs] rounded to whole numbers), including 584, 593, 592 and 378 FTEs in the Grand Duchy of Luxembourg, the rest of Europe, the United States and the rest of the world, respectively. SES is a truly international company represented by 76 different nationalities, which is also reflected in the SES Leadership Development Programme. The top five nationalities by number of employees are the US (586 employees), Germany (332), Israel (205), the UK (176) and France (122).

RECRUITMENT AND TALENT ACQUISITION

In 2018 we created a new global in-house Talent Acquisition function with dedicated personnel and developed a new Strategic Plan aligned to business imperatives. Marketing and Internal and External Communications teams collaborate on the Employer Branding and Social Recruiting strategy to be implemented in 2019.

We upgraded and increased the systems and tools to enable recruiters to hire effectively whilst maintaining a strong focus on generating a best-in-class candidate experience. We also introduced direct hiring capability to attract and engage passive candidates in line with the new and changing skill sets required by the business, and to generate a more even split in the gender diversity of candidate pipelines.

As a result, in 2018 we filled 392 positions (73% male, 27% female) with 82% external hires. 28% of new hires fall within the newly designated Recent College Graduates (RCG) classification and our target is to increase this to between 35-50% in 2019. 51% of the positions were filled in Europe, 28% in North America. 30% were hired by SES Networks and 25% were hired by SES Video.

LEARNING AND DEVELOPMENT

We offer a comprehensive portfolio of learning and professional development programmes to all our employees. In 2018, we logged 8,160 participations in training for a total of 16,849 hours of learning, with participation up by 155% from 3,196 in 2017. This was facilitated by the increase in e-learning offerings. In fact, 6,309 of participations (77%) were in e-learning format.

Top learning events in terms of hours delivered in 2018:

• Insights based selling: A different approach to complex B2B sales
• The EU General Data Protection Regulation (GDPR)
• CEI Satellite Communications Systems
• IT Security Computer Security and Phishing
• Code of Conduct E-Learning
• SES-12/14 Satellite Manufacturers' Training (Airbus)
• Anti-bribery E-Learning
• IT Security Awareness Protect SES
• Stevens Institute of Technology Business Engineering
• Harassment Prevention E-Learning Course
• Stress Management the Shaolin Way
• FranklinCovey "The 5 Choices"

We also managed a global Mentoring Programme last year with 70+ participants mentored by SES executives and introduced a monthly global Executive Lunch and Learn education session.

GIVING BACK

SES's entire team focuses on charitable work, including charitable activities that benefit from our donation-matching programme, SES social clubs, and charity projects endorsed by our HR Learning and Development team. These activities engage and motivate our colleagues, who then inspire each other to give back to the community where we work.

SES matches employee donations to charitable organisations including the Red Cross, the Red Crescent, Oxfam, Unicef, Médecins Sans Frontières/Doctors Without Borders, and Telecoms Sans Frontières.

In 2018, a group of SES volunteers developed SHARITY, an employee-based charity designed to support small and tailored development projects around the world. In 2018, SHARITY collected over EUR 10,000 through its "1 charity per month" programme.

"We are happy to announce that in 2018, we opened a new hospital and pharmacy which will provide much needed medical services and traditional Tibetan medicine to a remote area of eastern Tibet, that has limited access to health care." - Golog Support Foundation Luxembourg

"From our hearts, the single word 'thank you' is not enough to express your generosity in extending a helping hand for our Shine Special School for mentally and physically challenged children and support for parents." - SHINE Educational Trust, India

"Your contribution will assist us to feed over 100 children each day, provide educational materials and most importantly give hope to each child of Lethoteng." – Lethoteng Community Centre, South Africa

Habitat for Humanity

We are proud of our commitment to serve the local communities where we operate. Many of our employees regularly volunteer independently and within the activities organised at company-led events.

Habitat for Humanity is a global, non-profit housing organisation with over 40 years of experience. The organisation empowers people in the world's poorest communities to overcome the chronic lack of decent, affordable housing. In 2018, SES in Princeton (United States) continued the partnership with Habitat for Humanity and our employees volunteered to help build homes for members of the local community.

ETHICAL APPROACH

Bribery and corruption

SES is committed to respecting the highest ethical and legal standards, 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, but also by doing more and more business with governments. Providing anti-bribery training is one way to reduce this risk. In the context of the overall compliance training, during which more than 3,100 staff were trained (with a focus on GDPR and IT Security), 147 of the most exposed staff members went through anti-bribery training. We are also conducting external due diligence on our third-party agents upon their appointment. The level of this due diligence depends on the risk assessment, which itself is based on several elements, including the country of operation and the type of business.

We also reduce the risk of bribery through a clear process for gifts and entertainment. The relevant policy, which like all compliance policies is available on a dedicated intranet page, contains a dedicated e-mail address that can be used to obtain guidance prior to providing or accepting a gift or entertainment.

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. SES will not support or deal with any business knowingly involved in slavery or human trafficking.

The nature of SES's business means that the majority of SES's suppliers are large international companies providing complex technical services relating to the space industry through highly skilled professional employees. SES's 50 largest suppliers account for approximately 80% of procurement spending.

SES does not procure a substantial amount of goods or services in sectors that are considered to be high risk for human trafficking or slavery (such as agriculture or horticulture, construction, textiles, catering and restaurants, domestic work, entertainment and the sex industry).

SES considers that, in its role as customer, it plays a key role in setting the expectation that our suppliers comply with the law at all times. SES has created a Code of Conduct for Suppliers, which clearly outlines SES's stance towards slavery and human trafficking. SES also includes in its contracts with suppliers a clause requiring the supplier to comply with all laws applicable to the provision of the goods or service. SES's contracts with its suppliers also often 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.

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 any time and ensure that an appropriate system 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 2018, prepared in accordance with Luxembourg legal and regulatory requirements, and the consolidated financial statements as of end for the year ended 31 December 2018, 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 individually, 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 subsidiaries taken as a whole, together with a description of the principal risks and uncertainties that they face.

26 February 2019

Romain Bausch Chairman of the Board of Directors

Steve Collar President and CEO

FINANCIAL REVIEW BY MANAGEMENT

OPERATIONAL REVIEW

REVENUE BY BUSINESS UNIT

			Change (%)
In millions of euros	FY 2018	FY 2017	Reported	Constant FX
Video	1,306.3	1,383.0	-5.5%	-3.7%
Underlying1	1,292.1	1,373.2	-5.9%	-4.0%
Periodic2	14.2	9.8	n/m	n/m
Networks	695.7	646.1	+7.7%	+12.9%
Underlying1	671.1	606.6	+10.6%	+15.8%
Periodic2	24.6	39.5	n/m	n/m
Sub-total	2,002.0	2,029.1	-1.3%	+1.5%
Underlying1	1,963.2	1,979.8	-0.8%	+1.9%
Periodic2	38.8	49.3	n/m	n/m
Other3	8.3	5.9	n/m	n/m
Group Total	2,010.3	2,035.0	-1.2%	+1.7%

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 on a quarterly basis. 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 Video or Networks

2018 underlying revenue of EUR 1,963.2 million was EUR 37.1 million (or 1.9%) higher at constant FX, compared with the prior year, driven by double-digit growth delivered by the expansion of the Networks business. Total group revenue included periodic and other revenue of EUR 47.1 million (2017: EUR 55.2 million).

Video underlying revenue of EUR 1,292.1 million was 4.0% lower (year-on-year) at constant FX due to lower video distribution revenue (-5.2%), notably in the International markets where trading conditions remain highly competitive, while video services was in line (-0.5%) with the prior year.

Networks underlying revenue grew by 15.8% (year-on-year) at constant FX to EUR 671.1 million reflecting the benefit of SES's unique (GEO-MEO-terrestrial) network architecture. All three of Networks' verticals delivered year-on-year growth with Mobility up 35.4%, Government up 19.4% and Fixed Data up 2.1%.

Other revenue of EUR 8.3 million includes transactions not directly applicable to Video or Networks.

FINANCIAL REVIEW

REVENUE, OPERATING EXPENSES AND EBITDA

In millions of euros	FY 2018	FY 2017	Change	Change (%)
Revenue	2,010.3	2,035.0	-24.7	-1.2%
Revenue (constant FX)	2,010.3	1,977.4	+32.9	+1.7%
Operating expenses	(754.8)	(710.8)	-44.0	-6.2%
Operating expenses (constant FX)	(754.8)	(689.0)	-65.8	-9.5%
EBITDA	1,255.5	1,324.2	-68.7	-5.2%
EBITDA (constant FX)	1,255.5	1,288.4	-32.9	-2.6%

Reported revenue was lower than the prior period due to the weaker US dollar compared to 2017. At constant FX, revenue increased by EUR 32.9 million (or 1.7%) reflecting the contribution of Networks' double-digit underlying growth.

Operating expenses were EUR 44.0 million higher as reported (or EUR 65.8 million at constant FX) and included a restructuring charge of EUR 11.1 million as part of the company's on-going optimisation programme. Excluding this restructuring charge, investment to support the expansion of end-to-end solutions in SES Networks, which has delivered double-digit growth (year-on-year) in its underlying revenue, was the main contributor to the higher operating expenses.

Group EBITDA of EUR 1,255.5 million represented an EBITDA margin of 62.5% (2017: 65.1%), or 63.0% excluding the restructuring charge noted above.

DEPRECIATION, AMORTISATION AND OPERATING PROFIT

In millions of euros	FY 2018	FY 2017	Change	Change (%)
Depreciation and impairment expense	(719.0)	(635.0)	-84.0	-13.2%
Amortisation and impairment expense	(145.4)	(78.6)	-66.8	-85.0%
Depreciation, amortisation and impairment	(864.4)	(713.6)	-150.8	-21.1%
Depreciation, amortisation and impairment (constant FX)	(864.4)	(690.2)	-174.2	-25.3%
Operating profit	391.1	610.6	-219.5	-36.0%
Operating profit (constant FX)	391.1	598.2	-207.1	-34.6%

Reported depreciation, amortisation and impairment

expense increased by EUR 150.8 million compared with the prior year and includes EUR 156.4 million of impairment expenses (comprising EUR 93.1 million relating to satellites, mainly Ciel-2 and ASTRA 5B, and EUR 63.3 million relating to MX1) related to the more prudent outlook and recognised as part of the group's regular impairment testing process.

Excluding impairment, depreciation expense was higher (at constant FX) than the prior year reflecting the entry into service of new satellites since 31 December 2017.

Operating profit represented an operating profit margin of 19.5% (2017: 30.0%), or 27.5% excluding the restructuring charges and impairment expenses as noted above.

PROFIT ATTRIBUTABLE TO SES SHAREHOLDERS

In millions of euros	FY 2018	FY 2017	Change	Change (%)
Net interest expense and other	(180.3)	(189.2)	+8.9	+4.7%
Capitalised interest	28.9	47.0	-18.1	-38.6%
Net foreign exchange gains	5.1	(1.1)	+6.2	n/m
Net financing costs	(146.3)	(143.3)	-3.0	-2.1%
Profit before tax	244.8	467.3	-222.5	-47.6%
Income tax benefit/(expense)	41.9	130.6	-88.7	n/m
Profit after tax	286.7	597.9	-311.2	-52.1%
Non-controlling interests	5.7	(1.8)	+7.5	n/m
Profit attributable to SES shareholders	292.4	596.1	-303.7	-50.9%
Coupon on hybrid (perpetual) bond, net of tax	(48.1)	(47.3)	-0.8	-1.5%
Adjusted profit attributable to SES shareholders	244.3	548.8	-304.5	n/m
Basic earnings per Class A share	EUR 0.54	EUR 1.21	-0.67	-55.4%

Net financing costs were EUR 3.0 million higher than the prior period with lower capitalised interest partly offset by the reduction in net interest expense and higher foreign exchange gains.

The positive income tax contribution included the recognition of a one-time deferred tax asset relating to GovSat-1 in Q1 2018, the transfer of the O3b Jersey business to Luxembourg in H1 2018 and, in Q4 2018, the favourable impact of the Dutch corporate income tax reform.

The positive contribution of non-controlling interests reflects the share of impairment expenses, noted above, not attributable to SES. These offset the deferred tax asset relating to GovSat-1 that was recognised in the first quarter 2018.

Net profit attributable to SES shareholders of EUR 292.4 million (2017: EUR 596.1 million) represented basic earnings per share of EUR 0.54 (2017: EUR 1.21) after deducting the assumed coupon (net of tax) for the group's hybrid (perpetual) bonds.

CASH FLOW AND FINANCING

FREE CASH FLOW BEFORE FINANCING ACTIVITIES

In millions of euros	FY 2018	FY 2017	Change	Change (%)
Net cash generated by operating activities	1,191.3	1,251.2	-59.9	-4.8%
Net cash absorbed by investing activities	(320.8)	(490.4)	+169.6	+34.6%
Free cash flow before financing activities	870.5	760.8	+109.7	+14.4%

Net cash generated by operating activities was lower than the prior year, in line with the development in EBITDA. The group's cash conversion ratio (measured as the ratio of net cash generated by operating activities to EBITDA) was 94.9% (2017: 94.5%).

Lower net cash absorbed by investing activities of EUR 169.6 million resulted in an overall increase of EUR 109.7 million (or 14.4%) in free cash flow before financing activities compared with the prior year. Consequently, the ratio of free cash flow before financing activities to revenue increased from 37.4% in 2017 to 43.3% in 2018.

NET DEBT TO EBITDA RATIO

In millions of euros	31 December 2018	31 December 2017	Change	Change (%)
Borrowings1	4,384.9	3,947.9	-437.0	-11.1%
Cash and cash equivalents	(909.1)	(269.6)	+639.5	n/m
Net debt	3,475.8	3,678.3	+202.5	+5.5%
Net debt to EBITDA (rating agency)2	3.29 times	3.27 times
Weighted average interest cost3	3.62%	3.66%
Weighted average debt maturity	7.0 years	7.0 years

1 As presented using IFRS recognition principles, where hybrid (perpetual) bonds are treated as 100% equity

2 Rating agency methodology treats the hybrid bonds as 50% debt and 50% equity. Net debt to EBITDA represents the ratio of net debt plus 50% of the group's EUR 1.3 billion of hybrid bonds, divided by the last 12 months' EBITDA.

3 Excluding loan origination costs, commitment fees and hybrid bonds (average coupon of 5.05%)

Group net debt reduced by EUR 202.5 million, or 5.5%, and the group's net debt to EBITDA ratio was 3.29 times as of 31 December 2018.

In October 2018, the group repaid a five-year EUR 500 million Eurobond that was due for maturity and carried a fixed interest rate of 1.875%. This was funded from the group's existing resources, which included the proceeds from the issuance of an eight-year EUR 500 million Eurobond with an annual coupon of 1.625% that was successfully completed in March 2018.

In December 2018, the group received EUR 400 million from the placing of a multi-tranche Schuldschein loan. The proceeds will support SES's general corporate purposes and the refinancing of existing debt maturities, including a USD 500 million 144A bond with a final maturity date of March 2019. As a result, SES has no further senior debt maturities to be financed until early 2020.

The successful financing activities completed in 2018 resulted in an overall reduction in the group's weighted average interest cost, while the weighted average debt maturity is maintained at the same level of 12 months prior.

DIVIDEND

The Board of SES is proposing a dividend of EUR 0.80 for each Class A share and EUR 0.32 for each Class B share. This dividend, which is subject to approval at the company's annual general meeting on 4 April 2019, will be paid to shareholders on 25 April 2019.

FINANCIAL OUTLOOK

The financial outlook assumes a EUR/USD FX rate of EUR 1 = USD 1.15, nominal launch schedule and satellite health status.

SES delivered on the financial outlook for 2018 with group revenue exceeding the top end of the range, fuelled by

double-digit growth in SES Networks and SES Video delivering in line with the company's expectations. In addition, total capital expenditure (representing the net cash absorbed by the group's investing activities excluding acquisitions and financial investments) of EUR 321 million in 2018 was EUR 139 million, or 30%, lower than the outlook.

In millions of euros	2019	2020
Video revenue	1,225 - 1,255	1,200 - 1,250 (from 1,250 - 1,300)
Networks revenue	740 - 775	850 - 900
Other revenue	Approximately 10	Approximately 10
Group revenue	1,975 - 2,040	2,060 - 2,160 (from 2,110 - 2,210)
EBITDA	1,220 - 1,2651	1,260 - 1,340 (from 1,340 - 1,410)

1 Excluding a restructuring charge of EUR 25-30 million expected to be recognised in 2019

2019 expected group revenue reflects continued underlying growth, offset by lower forecast periodic and other revenue (compared with EUR 47 million in 2018).

2020 group revenue is expected to grow reflecting the strong outlook for SES Networks, which is unchanged, while the outlook for SES Video is trimmed to include a more prudent view of expected development of volume in North American distribution, particularly wholesale, and a more prudent view for the level of growth expected in video services.

EBITDA development in 2019 and 2020 reflects the combination of expected growth in underlying revenue, driven by the expansion of end-to-end solutions in SES Networks which will require additional investment to deploy. This additional investment is expected to be largely offset by operational efficiencies in other areas generated by SES's on-going optimisation programme.

Expected capital expenditure (representing the net cash absorbed by the group's investing activities excluding acquisitions and financial investments) for the period of 2019-2022 is consistent with SES's previous expectations and comprises EUR 450 million in 2019, EUR 390 million in 2020, EUR 1,200 million in 2021 (principally relating to the investment in O3b mPOWER) and EUR 450 million in 2022, while the capital expenditure for 2023 is expected to be EUR 450 million.

SUPPLEMENTARY INFORMATION

EUR/US DOLLAR EXCHANGE RATE

	2018 average	2018 closing	2017 average	2017 closing
EUR = US Dollars	1.1838	1.1450	1.1249	1.1993

QUARTERLY INCOME STATEMENT (AS REPORTED)

In millions of euros	Q4 2017	Q1 2018	Q2 2018	Q3 2018	Q4 2018
Average EUR/USD exchange rate	1.1764	1.2221	1.2033	1.1682	1.1418
Revenue	507.8	477.6	503.8	488.0	540.9
Operating expenses	(178.2)	(173.2)	(187.1)	(181.4)	(213.1)
EBITDA	329.6	304.4	316.7	306.6	327.8
EBITDA margin	64.9%	63.7%	62.9%	62.8%	60.6%
Depreciation and impairment	(147.0)	(147.0)	(156.5)	(160.2)	(255.3)
Amortisation and impairment	(20.4)	(18.6)	(21.3)	(19.8)	(85.7)
Operating profit	162.2	138.8	138.9	126.6	(13.2)
Operating profit margin	31.9%	29.1%	27.6%	26.0%	-2.5%
Net financing costs	(41.1)	(35.9)	(39.3)	(36.3)	(34.8)
Profit before tax	121.1	102.9	99.6	90.3	(48.0)
Income tax benefit/(expense)	81.1	10.1	30.8	(13.6)	14.6
Non-controlling interests	(0.6)	(14.8)	(0.9)	(0.7)	22.1
Profit attributable to owners of the parent	201.6	98.2	129.5	76.0	(11.3)
Basic earnings per share (in EUR)1
Class A shares	0.42	0.19	0.26	0.14	(0.05)
Class B shares	0.17	0.08	0.10	0.06	(0.02)

1 Earnings per share is calculated as profit attributable to owners of the parent divided by the weighted average number of shares outstanding during the year, as adjusted to reflect the economic rights of each class of share. For the purposes of the EPS calculation only, the net profit for the year attributable to ordinary shareholders has been adjusted to include the coupon, net of tax, on the perpetual bonds. Fully diluted earnings per share are not significantly different from basic earnings per share

QUARTERLY OPERATING PROFIT (AT CONSTANT FX)

In millions of euros	Q4 2017	Q1 2018	Q2 2018	Q3 2018	Q4 2018
Average US dollar exchange rate	1.1418	1.1418	1.1418	1.1418	1.1418
Revenue	514.2	492.8	516.4	493.6	540.9
Operating expenses	(181.3)	(180.9)	(193.4)	(183.9)	(213.1)
EBITDA	332.9	311.9	323.0	309.7	327.8
EBITDA margin	64.7%	63.3%	62.5%	62.7%	60.6%
Depreciation	(149.8)	(153.2)	(161.7)	(162.6)	(255.3)
Amortisation	(20.5)	(18.9)	(21.5)	(20.0)	(85.7)
Operating profit	162.6	139.8	139.8	127.1	(13.2)
Operating profit margin	31.6%	28.4%	27.1%	25.7%	-2.5%

CONSOLIDATED FINANCIAL STATEMENTS

CONTENTS

Auditor's report	77
Consolidated income statement	81
Consolidated statement of comprehensive income	82
Consolidated statement of financial position	83
Consolidated statement of cash flows	84
Consolidated statement of changes in shareholders' equity	85
Notes to the consolidated financial statements	86
Note 1 - Corporate information	86
Note 2 - Summary of significant accounting policies	86
Note 3 - Implementation of new International Financial Reporting Standards	101
Note 4 - Segment information	103
Note 5 - Operating expenses	105
Note 6 - Audit and non-audit fees	106
Note 7 - Finance income and costs	106
Note 8 - Income taxes	107
Note 9 - Deferred income tax	109
Note 10 - Components of other comprehensive income	111
Note 11 - Earnings per share	111
Note 12 - Dividends paid and proposed	112
Note 13 - Property, plant and equipment	113
Note 14 - Assets in the course of construction	116
Note 15 - Intangible assets	117
Note 16 - Assets and liabilities related to contracts with customers	121
Note 17 - Trade and other receivables	122
Note 18 - Financial instruments	123
Note 19 - Financial risk management objectives and policies	126
Note 20 - Cash and cash equivalents	131
Note 21 - Shareholders' equity	133
Note 22 - Non-controlling interest	134
Note 23 - Share-based compensation plans	135
Note 24 - Interest-bearing borrowings	138
Note 25 - Provisions	140
Note 26 - Trade and other payables	141
Note 27 - Other long-term liabilities	141
Note 28 - Fixed assets suppliers	142
Note 29 - Commitments and contingencies	143
Note 30 - Leases	143
Note 31 - Cash flow information	145
Note 32 - Related parties	146
Note 33 - Post-Balance Sheet events	146
Note 34 - Consolidated subsidiaries, associates	147

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 2018, 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 December 2018;
• 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 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 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 Ethics Standards Board for Accountants' Code of Ethics for Professional 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 Regulation (EU) 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 6 to the consolidated financial statements.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period, and include the most significant assessed risks of material misstatement (whether or not due to fraud). 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, barter transactions, principle versus agent considerations, etc.).

We focused on this area due to the inherent complexity and judgement in applying the revenue recognition accounting standards and to the significant focus on the revenue amount (2,010.3 million EUR for the year ended 31 December 2018) by the users of the consolidated financial statements.

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;
• We tested the design and implementation of relevant internal controls;
• We held discussions with Management on IFRS accounting analysis of any non-standard revenue contracts, performed testing of significant new revenue contracts and verified that the underlying revenue transactions were accounted in accordance with the substance of the commercial agreement and the relevant IFRS standards;
• We performed substantive analytical procedures at yearend on revenue and revenue related accounting in order to identify any unusual variances;
• We tested certain 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 of a sample of revenue transactions;
• We considered the disclosures in the consolidated financial statements and assessed their appropriateness.

Impairment of satellites

The Group has a space segment assets balance, representing primarily satellites, of 4,648.7 million EUR as at 31 December 2018. An impairment charge of 87.6 million EUR was recognised for the year ended 31 December 2018 in relation to four satellites, due to the decrease of their forecasted future revenue (see Note 13).

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 decrease in revenue due to unfavourable market developments.

Moreover, there is a risk of impairment of the satellites due to obsolescence 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 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 involved valuation specialists and validated the method used to derive the value in the use of satellites presenting a risk of impairment. We independently recalculated the weighted average cost of capital based on the use of market data.
• We performed a sensitivity analysis of the models to changes in the key assumptions;
• We considered the disclosures in Note 13 to the consolidated financial statements.

Impairment of goodwill and indefinite useful lives intangible assets

The Group has goodwill of 2,284.2 million EUR and orbital rights with indefinite useful lives of 2,058.1 million EUR. An impairment charge of 63.3 million EUR was recognised for the year ended 31 December 2018 in relation to the MX1 CGU (see Note 15).

Management performed the annual impairment test that is based on the value in use determined on the basis of a discounted cash flows model.

We focused on this area due to the high level of judgement in relation with the assumptions used in the calculation of the recoverable amount (forecasted cash flows, growth rate, discount rate, 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 2019 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 a sensitivity analysis of the models to changes in the key assumptions;
• We considered the appropriateness of the disclosures in Note 15 to the consolidated financial statements.

Taxation

The Group operates across a large number of jurisdictions and is subject to various tax legislations and periodic reviews by local tax authorities of a range of tax matters during the normal course of business, including transfer pricing.

Moreover, the current tax structure of the Group evolves to consider the 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 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 understand and evaluate positions taken on uncertain tax risks and assessed Group tax provision;
• We discussed with Management the status of the open tax audits and evaluated their impact on the consolidated financial statements;
• 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 Notes 8 and 9 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 annual report including 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 statements, 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 information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of the Board of Directors for the consolidated financial statements

The Board of Directors is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with IFRSs as adopted by the European Union, and for such internal control 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.

Responsibilities of the "Réviseur d'entreprises agréé" for the audit of the consolidated 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 conducted 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. 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 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 professional scepticism throughout the audit. We also:

• identify and assess the risks of material misstatement of the consolidated 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 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 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 material uncertainty exists, we are required to draw attention in our audit report to the related disclosures in the consolidated financial statements 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 independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

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.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

The consolidated management report is consistent with the consolidated 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 Paragraph (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" of the Group by the General Meeting of the Shareholders on 5 April 2018 and the duration of our uninterrupted engagement, including previous renewals and reappointments, is 6 years.

Other matter

The Corporate Governance Statement includes, when applicable, the information required by Article 68ter Paragraph (1) Letters a), b), e), f) and g) 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.

PricewaterhouseCoopers, Société coopérative Luxembourg, 26 February 2019

Represented by Gilles Vanderweyen

CONSOLIDATED INCOME STATEMENT

For the year ended 31 December 2018

In millions of euros		2018	2017
Revenue	Note 4	2,010.3	2,035.0
Cost of sales	Note 5	(285.8)	(273.9)
Staff costs	Note 5	(305.7)	(279.2)
Other operating expenses	Note 5	(163.3)	(157.7)
Operating expenses	Note 5	(754.8)	(710.8)
EBITDA		1,255.5	1,324.2
Depreciation and impairment expense	Note 13	(719.0)	(635.0)
Amortisation and impairment expense	Note 15	(145.4)	(78.6)
Operating profit	Note 4	391.1	610.6
Finance income	Note 7	16.7	1.1
Finance cost	Note 7	(163.0)	(144.4)
Net financing costs		(146.3)	(143.3)
Profit before tax		244.8	467.3
Income tax benefit	Note 8	41.9	130.6
Profit after tax		286.7	597.9
Profit for the year		286.7	597.9
Attributable to:
Owners of the parent		292.4	596.1
Non-controlling interests		(5.7)	1.8
		286.7	597.9
Basic earnings per share (in euro)
Class A shares	Note 11	0.54	1.21
Class B shares	Note 11	0.22	0.48
Diluted earnings per share (in euro)
Class A shares	Note 11	0.54	1.21
Class B shares	Note 11	0.21	0.48

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the year ended 31 December 2018

In millions of euros		2018	2017
Profit for the year		286.7	597.9
Other comprehensive income
Items that will not be reclassified to profit or loss
Remeasurements of post-employment benefit obligation		0.4	1.0
Income tax effect		(0.2)	(0.3)
Remeasurements of post-employment benefit obligation, net of tax		0.2	0.7
Income tax relating to treasury shares impairment charge or reversal		(6.4)	14.2
Total items that will not be reclassified to profit or loss		(6.2)	14.9
Items that may be reclassified subsequently to profit or loss
Impact of currency translation	Note 10	345.2	(1,050.9)
Income tax effect	Note 10	(20.8)	60.3
Total impact of currency translation, net of tax		324.4	(990.6)
Net investment hedge		(79.1)	234.8
Income tax effect		21.2	(65.4)
Total net investment hedge, net of tax		(57.9)	169.4
Net movements on cash flow hedges, net of tax		1.2	(1.1)
Total net movements on cash flow hedges, net of tax		1.2	(1.1)
Total items that may be reclassified subsequently to profit or loss		267.7	(822.3)
Total other comprehensive income/ (loss) for the year, net of tax		261.5	(807.4)
Total comprehensive income/ (loss) for the year, net of tax		548.2	(209.5)
Attributable to:
Owners of the parent		550.2	(200.8)
Non-controlling interests		(2.0)	(8.7)
		548.2	(209.5)

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

As at 31 December 2018

In millions of euros		2018	2017
Non-current assets
Property, plant and equipment	Note 13	5,106.9	4,591.4
Assets in the course of construction	Note 14	907.4	1,480.2
Total property, plant and equipment		6,014.3	6,071.6
Intangible assets	Note 15	4,720.5	4,630.9
Other financial assets		6.5	5.0
Trade and other receivables	Note 17	294.5	317.8
Deferred customer contract costs		10.3	15.2
Deferred tax assets	Note 9	162.3	70.4
Total non-current assets		11,208.4	11,110.9
Current assets
Inventories		35.1	30.1
Trade and other receivables	Note 17	614.2	648.2
Deferred customer contract costs		17.5	10.4
Prepayments		62.8	43.7
Derivatives	Note 18	0.2	2.6
Income tax receivable		12.0	68.9
Cash and cash equivalents	Note 20	909.1	269.6
Total current assets		1,650.9	1,073.5
Total assets		12,859.3	12,184.4
Equity
Attributable to the owners of the parent	Note 21	6,148.4	5,987.9
Non-controlling interests	Note 22	102.2	124.6
Total equity		6,250.6	6,112.5
Non-current liabilities
Borrowings	Note 24	3,908.5	3,413.8
Provisions	Note 25	16.8	41.2
Deferred income	Note 16	370.3	477.3
Deferred tax liabilities	Note 9	412.5	438.5
Other long-term liabilities	Note 27	133.9	76.1
Lease liabilities	Note 30	28.6	-
Fixed assets suppliers	Note 28	200.9	53.4
Total non-current liabilities		5,071.5	4,500.3
Current liabilities
Borrowings	Note 24	476.4	534.1
Provisions	Note 25	48.6	12.7
Deferred income	Note 16	476.1	443.2
Trade and other payables	Note 26	367.5	385.6
Lease liabilities	Note 30	9.5	-
Fixed assets suppliers	Note 28	130.8	126.6
Derivatives	Note 18		0.6
		0.1
Income tax liabilities		28.2	68.8
Total current liabilities		1,537.2	1,571.6
Total liabilities		6,608.7	6,071.9
Total equity and liabilities		12,859.3	12,184.4

CONSOLIDATED STATEMENT OF CASH FLOWS

For the year ended 31 December 2018

In millions of euros		2018	2017
Profit before tax		244.8	467.3
Taxes paid during the year		(37.8)	(58.4)
Interest expense on borrowings	Note 7	128.0	111.0
Depreciation, amortisation and impairment	Notes 13, 15	864.4	713.6
Amortisation of client upfront payments		(75.8)	(70.8)
Other non-cash items in the consolidated income statement		63.6	34.3
Consolidated operating profit adjusted for non-cash items and tax payments and before working capital changes		1,187.2	1,197.0
Changes in working capital, net of business combinations effect
(Increase)/decrease in inventories		(5.2)	(2.7)
(Increase)/decrease in trade and other receivables		(39.0)	(125.5)
(Increase)/decrease in prepayments and deferred charges		(33.4)	(13.0)
Increase/(decrease) in trade and other payables		92.2	66.7
Increase/(decrease) in payments received on account		(22.2)	(42.7)
Increase/(decrease) in upfront payments and deferred income		11.7	171.4
Changes in working capital		4.1	54.2
Net cash generated by operating activities		1,191.3	1,251.2
Cash flow from investing activities
Payments for purchases of intangible assets		(37.4)	(35.1)
Payments for purchases of tangible assets		(290.8)	(446.1)
Proceeds from disposals of tangible assets		11.6	1.1
Investment in equity accounted investments		(1.2)	(8.7)
Other investing activities		(3.0)	(1.6)
Net cash absorbed by investing activities		(320.8)	(490.4)
Cash flow from financing activities
Proceeds from borrowings	Note 31	893.0	34.5
Repayment of borrowings	Note 31	(541.7)	(287.5)
Proceeds from perpetual bond, net of transaction costs paid		-	(2.1)
Coupon paid on perpetual bond	Note 21	(65.6)	(24.7)
Dividends paid on ordinary shares1	Note 12	(362.9)	(608.3)
Dividends paid to non-controlling interest		(6.2)	(7.2)
Interest paid on borrowings		(152.3)	(158.3)
Payments for acquisition of treasury shares		(15.9)	(51.3)
Proceeds from treasury shares sold and exercise of stock options		28.8	40.5
Lease payments	Note 30	(9.5)	-
Other financing activities		0.5	1.9
Net cash generated/(absorbed) by financing activities		(231.8)	(1,062.5)
Net foreign exchange movements		0.8	(16.2)
Net (decrease)/increase in cash		639.5	(317.9)
Cash and cash equivalents at beginning of the year	Note 20	269.6	587.5
Cash and cash equivalents at end of the year	Note 20	909.1	269.6

1 Dividends are presented net of dividends received on treasury shares of EUR 5.3 million (2017: EUR 8.3 million)

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY

For the year ended 31 December 2018

Attributable to owners of the parent
In millions of euros	Issued capital	Share premium	Treasury shares	Perpetual bond	Other reserves	Retained earnings	Cash flow hedge reserve	Foreign currency translation reserve	Total	Non controlling interest	Total equity
At January 2018	719.0	1,635.5	(160.0)	1,300.0	2,487.0	596.1	(0.8)	(588.9)	5,987.9	124.6	6,112.5
Changes in accounting policies1	-	-	-	-	-	(14.3)	-	-	(14.3)	-	(14.3)
Restated total equity at January 2018	719.0	1,635.5	(160.0)	1,300.0	2,487.0	581.8	(0.8)	(588.9)	5,973.6	124.6	6,098.2
Result for the year	-	-	-	-	-	292.4	-	-	292.4	(5.7)	286.7
Other comprehensive income (loss)	-	-	-	-	(6.2)	-	1.2	262.8	257.8	3.7	261.5
Total comprehensive income (loss) for the year	-	-	-	-	(6.2)	292.4	1.2	262.8	550.2	(2.0)	548.2
Allocation of 2017 result	-	-	-	-	233.2	(233.2)	-	-	-	-	-
Coupon on perpetual bond (Note 21)	-	-	-	-	(65.6)	-	-	-	(65.6)	-	(65.6)
Tax on perpetual bond coupon (Note 21)	-	-	-	-	18.8	-	-	-	18.8	-	18.8
Dividends provided for or paid2	-	-	-	-	-	(362.9)	-	-	(362.9)	(6.2)	(369.1)
Acquisition of treasury shares	-	-	(15.9)	-	-	-	-	-	(15.9)	-	(15.9)
Share-based compensation expense	-	-	-	-	12.0	-	-	-	12.0	-	12.0
Exercise of share-based compensation	-	-	9.4	-	(13.3)	-	-	-	(3.9)	-	(3.9)
Sale of treasury shares	-	-	34.4	-	-	-	-	-	34.4	-	34.4
Transactions with non-controlling interests (Note 22)	-	-	-	-	7.6	-	-	-	7.6	(14.2)	(6.6)
Other movements	-	-	-	-	-	0.5	(0.4)	-	0.1	-	0.1
At 31 December 2018	719.0	1,635.5	(132.1)	1,300.0	2,673.5	278.6	-	(326.1)	6,148.4	102.2	6,250.6

1 Represents impact of the adoption of new International Financial Reporting Standards (Note 3) 2 Dividends are shown net of dividends received on treasury shares

For the year ended 31 December 2017

	Attributable to owners of the parent
In millions of euros	Issued capital	Share premium	Treasury shares	Perpetual bond	Other reserves	Retained earnings	Cash flow hedge reserve	Foreign currency translation reserve	Total	Non controlling interest	Total equity
At January 2017	719.0	1,635.5	(167.3)	1,300.0	2,134.5	962.7	0.3	221.8	6,806.5	138.6	6,945.1
Result for the year	-	-	-	-	-	596.1	-	-	596.1	1.8	597.9
Other comprehensive income (loss)	-	-	-	-	14.9	-	(1.1)	(810.7)	(796.9)	(10.5)	(807.4)
Total comprehensive income (loss) for the year	-	-	-	-	14.9	596.1	(1.1)	(810.7)	(200.8)	(8.7)	(209.5)
Allocation of 2016 result	-	-	-	-	354.4	(354.4)	-	-	-	-	-
Coupon on perpetual bond (Note 21)	-	-	-	-	(24.7)	-	-	-	(24.7)	-	(24.7)
Tax on perpetual bond coupon (Note 21)	-	-	-	-	19.5	-	-	-	19.5	-	19.5
Transaction cost on perpetual bond	-	-	-	-	(2.1)	-	-	-	(2.1)	-	(2.1)
Dividends provided for or paid2	-	-	-	-	-	(608.3)	-	-	(608.3)	(7.2)	(615.5)
Acquisition of treasury shares	-	-	(51.3)	-	-	-	-	-	(51.3)	-	(51.3)
Share-based compensation expense	-	-	-	-	9.7	-	-	-	9.7	-	9.7
Exercise of share-based compensation	-	-	7.7	-	(15.8)	-	-	-	(8.1)	-	(8.1)
Sale of treasury shares	-	-	50.9	-	-	-	-	-	50.9	-	50.9
Equity contribution by non-controlling interest	-	-	-	-	-	-	-	-	0.0	1.9	1.9
Other movements	-	-	-	-	(3.4)	-	-	-	(3.4)	-	(3.4)
At 31 December 2017	719.0	1,635.5	(160.0)	1,300.0	2,487.0	596.1	(0.8)	(588.9)	5,987.9	124.6	6,112.5

2 Dividends are shown net of dividends received on treasury shares

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

31 December 2018

NOTE 1 - CORPORATE INFORMATION

SES S.A. ('SES' or 'the Company') was incorporated on 16 March 2001 as a limited liability company (Société Anonyme) under Luxembourg Law. References to 'the Group' in the following notes are to the Company and its subsidiaries. SES trades under 'SESG' on the Luxembourg Stock Exchange and Euronext, Paris.

The consolidated financial statements of SES as at and for the year ended 31 December 2018 were authorised for issue in accordance with a resolution of the Board of Directors on 26 February 2019. Under Luxembourg Law, the consolidated financial statements are approved by the shareholders at the Annual General Meeting of Shareholders.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of preparation

The consolidated financial statements have been prepared in accordance 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 2018. The consolidated financial statements comply with IFRS.

The consolidated financial statements have been prepared on a historical cost basis, except where fair value is required by IFRS as described below. The carrying values of recognised assets and liabilities that are hedged items in fair value hedges, and are otherwise carried at cost, are adjusted to record changes in the fair values attributable to the risks that are being hedged.

Changes in accounting policies

A number of new or amended standards became applicable or were early adopted for the current reporting period and the Group had to change its accounting policies and make retrospective adjustments as a result of adopting the following standards: IFRS 9 'Financial Instruments', IFRS 15 'Revenue from Contracts with Customers' and IFRS 16 'Leases'.

The impact of the adoption of these standards and the new accounting policies are disclosed in Note 3 below.

The following other amended standards did not have any impact on the Group's accounting policies and did not require retrospective adjustments.

1) Amendments to IFRS 2, 'Share based payments', on clarifying how to account for certain types of sharebased payment transactions

In June 2016, the IASB issued amendments to clarify the measurement basis for cash-settled, share-based payments and the accounting for modifications that change an award from cash-settled to equity-settled. It also introduces an exception to the principles in IFRS 2 that will require an award to be treated as if it was wholly equity-settled, where an employer is obliged to withhold an amount for the employee's tax obligation associated with a share-based payment and pay that amount to the tax authority. The effective date of these amendments is 1 January 2018. The adoption of this amendment did not have any impact on the financial position and performance of the Group.

2) IFRIC 22, Foreign currency transactions and advance consideration

In December 2016, the IASB issued IFRIC 22 which addresses foreign currency transactions or parts of transactions where there is consideration that is denominated or priced in a foreign currency. The interpretation provides guidance for when a single payment/receipt is made as well as for situations where multiple payments/receipts are made. The guidance aims to reduce diversity in practice. This standard is effective for annual periods beginning on or after 1 January 2018. The adoption of this interpretation did not have any impact on the financial position and performance of the Group.

3) Annual improvements 2014-2016 applicable for the annual periods beginning on or after 1 January 2018

Clarifying the scope of IFRS 12, Disclosure of interests in other entities

The amendment clarified that the disclosures requirement of IFRS 12 are applicable to interest in entities classified as held for sale, except for summarised financial information (para B17 of IFRS 12). These amendments apply retrospectively for annual periods beginning on or after 1 January 2017. The adoption of this amendment did not have any impact on the financial position and performance of the Group.

IAS 28 Investments in Associates and Joint Ventures regarding measuring an associate or joint venture at fair value

The amendment clarified that the election to measure at fair value through profit or loss an investment in an associate or a joint venture that is held by an entity

that is a venture capital organisation, or other qualifying entity, is available for each investment in an associate or joint venture on an investment-by-investment basis, upon initial recognition. The adoption of this amendment did not have any impact on the financial position and performance of the Group.

Basis of consolidation

The consolidated financial statements comprise the financial statements of the Company and its controlled subsidiaries, after the elimination of all material intercompany transactions. Subsidiaries are fully consolidated from the date the Company obtains control until such time as control ceases. Acquisitions of subsidiaries are accounted for using the purchase method of accounting. The financial statements of subsidiaries are prepared for the same reporting period as the Company, using consistent accounting policies. Adjustments are made to bring into line any dissimilar accounting policies that may exist. For details regarding the subsidiaries included in the consolidated financial statements see Note 34.

Total comprehensive income or loss within a subsidiary is attributed to the non-controlling interest even if that results in a deficit balance.

A change in the ownership interest in a subsidiary, without a loss of control, is accounted for as an equity transaction.

When the Group ceases 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 purposes of subsequently accounting for the retained interest as an associate, joint venture or financial asset. In addition, any amounts previously recognised 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 recognised 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, statement of comprehensive income, statement of changes in equity and statement of financial position respectively.

Investments in associates

The Group accounts for investments in associates using the equity method of accounting. An associate is an entity in which the Group has significant influence but not control or joint control.

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 associates' 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, including 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. Adjustments are made to bring in line any dissimilar accounting policies that may exist.

Profits and losses resulting from upstream and downstream transactions between the Group and its associate are recognised in the Group's financial statements only to the extent of unrelated investor's 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, management 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 application to the relevant national and international regulatory authorities 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, 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 15.

(ii) Taxation

The Group operates in numerous tax jurisdictions and management 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 specialist advice, as to whether it will result in a liability for the Group. If this is deemed to be the case, then a provision is recognised for the potential taxation charges. More details are given in Notes 8 and 25.

One significant area of management's judgment is around transfer pricing. Whilst the Group employs dedicated members of staff to establish and maintain appropriate transfer pricing structures and documentation, judgment still needs to be applied and hence potential tax exposures can be identified. 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

Management has concluded that the Group controls Al Maisan Satellite Communication LLC ('Al Maisan'), even though it holds 35% economic interest in this subsidiary, since it has the majority of the voting rights on the Board of Directors of Al Maisan and there is no other entity owning potential voting rights that could question SES's control.

SES has power over relevant activities of Al Maisan, such as budget approval, appointment and removal of the CEO and senior management team as well as the power to appoint or remove the majority of

the members of the Board of Directors. The entity is therefore consolidated with a 65% non-controlling interest (see Note 22).

LuxGovSat S.A.

In February 2015, SES and the Luxembourg government jointly incorporated the legal entity LuxGovSat S.A. ('LuxGovSat') as a limited liability company (Société Anonyme) under Luxembourg law. The Luxembourg government and SES subscribed equally in the equity of the new company. Management has concluded that the Group controls LuxGovSat, as SES has power over the relevant activities of the entity. It is therefore consolidated with a 50% non-controlling interest (see Note 22).

(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 which is being shared with industries. A proxy agreement 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 contracts with the DOD which contain classified information. The Proxy Agreement enables SES GS to participate in such contracts 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 whose basis their activity is performed in the interest of SES's shareholders and of US national security.

The Company's assessment of the allocation of powers 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, the Company concluded that, from an IFRS 10 perspective, SES has - and is able to use - powers over the relevant activities of SES GS and has an exposure to variable returns from its involvement in SES GS, consistent with an assumption of control.

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 carrying 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 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 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 also to choose a suitable pretax discount rate and terminal growth rate in order to calculate the present value of those cash flows. More details are given in Note 15.

(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 indication exists, the Group determines an estimate of the recoverable amount, as the higher of the fair value less cost of disposal and its value in use to ensure that this exceeds the carrying amount included in the consolidated financial statements. As far as this affects the Group's satellite assets, 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.

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 consideration agreement; and
• fair value of any pre-existing equity interest in the subsidiary.

For each business combination, the Company 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. This includes the separation of embedded derivatives in host contracts by the acquiree. 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 recognised 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 acquirer'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 the acquirer will be recognised at fair value at the acquisition 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 accordance with IFRS 9 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. Satellites cost includes the launcher and launch insurance, less depreciation and impairment losses. Insurance proceeds are set off first against the base cost of the asset concerned and released against the depreciation over the useful life of the asset. Insurance proceeds above the cost of the satellite are recognised as income when received. The financial impact of changes resulting from a revision of management'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 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 lease term of 12 months or less. Low-value assets comprise IT-equipment and small items of office furniture.

The financial impact of changes resulting from revisions to management's estimate of the cost of the property, plant and equipment is taken to the consolidated income statement of the period concerned.

Costs for the repair and maintenance of these assets are recorded as an expense.

Property, plant and equipment is depreciated using the straight-line method, generally based on the following useful lives:

Buildings	25 years
Space segment assets	10 to 19.5 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 disposal 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.

Assets in the course of construction

This caption includes satellites under construction. Incremental costs directly attributable to the purchase of satellites, such as launch costs and other related expenses such as ground equipment and borrowing costs, are capitalised in the statement of financial position.

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. Historically, the satellite manufacturers have earned substantially all of these payments. 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. 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 operates in the manner intended by management, the expenditure is transferred 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 construction 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 business combinations in Note 2.

After initial recognition, goodwill is measured at cost less any accumulated impairment losses. For the purpose of impairment testing, goodwill, from the acquisition date, is allocated to each of the Group's CGUs units that are expected to benefit from the combination, irrespective of whether other assets or liabilities of the acquiree 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 fair value less costs to sell and value in use. Impairment charges 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 discounted cash flows to be generated by a CGU using

five-year business 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 considered where relevant to accurately calculate the value in use. For example, for the 'SES MEO' CGU, cash flows are estimated through to 2033 to properly reflect the timing of the replacement capital expenditures, deriving a valuein-use that best represents the life cycle of the MEO assets.

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 International 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.

Indefinite-life intangible assets are held at cost in the statement of financial position and are subject to impairment testing in line with the treatment outlined for goodwill above. The useful life of an intangible asset with an indefinite life is 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 measured at the fair value of the consideration given.

(ii) Software and development costs

Costs associated with maintaining computer software programmes are recognised 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 software product include the software development employee costs and an appropriate portion of relevant overheads.

Other development expenditures that do not meet these criteria are recognised as an expense as incurred. Development costs previously recognised as an expense are not recognised as an asset in a subsequent period.

Computer software development costs recognised as assets are amortised over their estimated useful life, which does not exceed seven years.

Impairment of other non-financial assets

The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any such indication exists, or when annual impairment testing for an asset is required, the Group makes an estimate of the recoverable amount.

The Group's long-lived assets and definite-life intangible assets, including its in-service satellite fleet, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. 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

From 1 January 2018, 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 that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value and revalued through the income statement are expensed in the period when they were incurred.

All regular purchases and sales of financial assets are recognised on the trade date, that is to say 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 payment of principal and interest.

Debt instruments

Subsequent measurement of debt instruments depends on the Group's business model for managing the asset and the cash flow characteristics of the asset. There are two measurement categories into which the Group classifies its debt instruments:

• amortised cost: Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortised cost. Interest income from these financial assets is included in finance income using the effective interest rate method. Any gain or loss arising on derecognition is recognised directly in profit or loss and presented in other gains/(losses) together with foreign exchange gains and losses. Impairment losses are presented as separate line item in the statement of profit or loss;
• fair value through profit or loss: Assets that do not meet the criteria for amortised cost or fair value remeasurement through other comprehensive income, are remeasured to fair value through the income statement. Any gain or loss on a debt investment that is subsequently remeasured to fair value is recognised as part of net financing charges in the income statement covering the period in which it arises.

Equity instruments

The Group subsequently measures all equity investments at fair value. Where the Group's management has elected to present fair value gains and losses on equity investments in other comprehensive income, there is no subsequent reclassification of fair value gains and losses to profit or loss following the derecognition of the investment. Dividends from such investments continue to be recognised in profit or loss as other income when the Group's right to receive payments is established.

Changes in the fair value of financial assets at fair value through profit or loss are recognised in other gains/(losses) in the statement of profit or loss as applicable. Impairment losses (and reversal of impairment losses) on equity investments measured at fair value remeasurement through other comprehensive income are not reported separately from other changes in fair value.

Impairment of financial assets

From 1 January 2018, the Group assesses, on a forwardlooking basis, the expected credit losses associated with its debt instruments carried at amortised cost. The impairment methodology applied depends on whether there has been a significant increase in credit risk.

Deferred customer contract costs

Deferred customer contract costs include the following types of deferred costs: cost of equipment provided to customers under the terms of their service agreements and expensed over the term of those contracts (linked to SES MEO operations) and broadcaster subscriber costs expensed over the term of the service agreement (linked to HD Plus GmbH services).

Inventories

Inventories primarily consist of equipment held for resale, work-in-progress, related accessories and network equipment spares and are stated at the lower of cost or net realisable value, with cost determined 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 subsequently measured at amortised cost using the effective interest method, less provision for impairment. For impairment of trade receivables, the Group applies the simplified approach permitted by IFRS 9, which requires expected lifetime losses to be recognised from initial recognition of the receivables. Expected lifetime losses are estimated using provision metrics which are calculated based on historical financial information as well as forward looking data. Additional specific provisions are recognised when there is objective evidence that the Group will not be able to recover a specific debt. The Group evaluates the credit risk of its customers on an ongoing basis, classifying them into three categories: prime, market and sub-prime.

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 include 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 agreements for the provision of satellite capacity over contractually agreed periods, including short-term occasional use capacity, with the associated uplinking and downlinking services as appropriate. Other services generating revenue mainly include: platform services; subscription revenue; income received in connection with satellite interim missions; engineering services and proceeds from the sale of transponders if the revenue recognition criteria for the transaction are met. In 2018, no revenue (2017: EUR 21.4 million) has been recognised from the sale of transponders.

Revenue from customers under service agreements for satellite capacity is recognised on a straight-line basis at the fair value of the consideration received or receivable over the duration of the respective contracts - including any free-ofcharge periods.

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 services;
• the price of the contract increases by an amount of consideration that reflects the stand-alone selling prices of the additional services;
• any appropriate adjustments to that price to reflect the circumstances of the particular contract.

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 services to be provided to the customer under the modified contract are distinct.

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, free of use periods, incentives or other similar items. The standard deals with the uncertainty relating to variable consideration by limiting the amount of variable consideration that can be recognised. 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.

If payment by a customer is not assured (defined as when management determines recoverability of the amounts due under the contract from the customer is no longer considered probable), then revenue will cease to be recognised on a straight-line basis and will only be recognised upon receipt of cash.

The subscription revenue from the services provided by HD Plus GmbH and the associated operating costs are recorded on a linear basis over the 12-month term of the subscription agreement.

The proceeds of transponder sales are recognised in the period of the transaction at the time of transfer of the risks and rewards associated with the holding of the transponders. Income received in connection with insurance and legal settlements are recognised in the period when they become receivable by the Group.

Where satellite transponder services are provided in exchange for dissimilar goods and services, the revenue is measured at the fair value of the goods or services received where these can be reliably measured, otherwise at the fair value of the goods or services given up, adjusted by the amount of any cash or cash equivalents received.

Concerning revenue recognition in the area of engineering services, the Group applies a percentage of completion analysis to allocate revenue arising on long-term construction contracts appropriately between the accounting periods concerned assuming the outcome can be estimated reliably.

Lease income

Lease income from operating leases where the Group is lessor is recognised on a straight-line basis over the lease term. The respective leased assets are included in the balance sheet based on their nature.

Other income

Other income incurred in connection with settlements under insurance claims, or disputes with satellite manufactures, are recognised when it is virtually certain that the income will be realised. Other income is presented as part of revenue due to their 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 payments, interest is accrued on the amount received at the effective interest rate at the time of receipt.

The unbilled portion of recognised revenues is recorded as contract assets and presented as 'unbilled contract revenue' within 'Trade and other receivables', allocated between current and non-current as appropriate.

Dividends

The Company declares dividends after the financial statements for the year have been approved. Accordingly, dividends are recorded in the subsequent year's financial statements.

Provisions

Provisions are recognised when the Group has a present legal or constructive 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 statement over the period of the borrowings using the effective interest method.

Fees paid on the establishment of loan facilities are recognised as transaction 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 reporting 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 differences, 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 business 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 available 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 reporting 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) that 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 an asset or a liability, 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 circumstances 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 deferred tax 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.

Translation of foreign currencies

The consolidated financial statements are presented in euro (EUR), 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 liabilities are translated at closing rates of period. During the year, expenses and income expressed in foreign currencies are recorded at exchange rates which approximate to 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 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 operation. The related foreign exchange differences and income tax effect of the foreign exchange differences are included in the foreign currency translation reserve within equity. On disposal of a

foreign operation, the deferred cumulative amount recognised in equity relating to that particular 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 translated 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 cumulative amount recognised in equity relating to that particular 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:

	Average rate	Closing rate	Average rate	Closing rate
	for 2018	for 2018	for 2017	for 2017
USD	1.1838	1.1450	1.1249	1.1993

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 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 determination of basic earnings per share to take into account:

• the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares; and
• the weighted average number of additional ordinary shares that would have been outstanding assuming the conversion of all dilutive potential ordinary shares.

Derivative financial instruments and hedging

The Group recognises all derivatives at fair value in the consolidated statement of financial position. Changes in the fair value of derivatives are recorded in the consolidated income statement or in accordance with the principles below where hedge accounting is applied. The Group may use derivative financial instruments such as foreign

currency contracts and interest rate swaps to hedge its risks associated with foreign currency and interest rate fluctuations. On the date a hedging derivative instrument is entered into, the Group designates the derivative as one of the following:

1) Fair value hedges

Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recorded in the consolidated income statement, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk. The Group applies fair value hedge accounting for hedging fixed interest risk on borrowings, and for hedging of foreign currency risk on firm commitments and highly probable forecast transactions.

2) Cash flow hedges

In relation to cash flow hedges (forward foreign currency contracts and interest rate swaps on floating-rate debt) to hedge firm commitments or forecasted transactions, the portion of the gain or loss on the hedging instrument that is determined to be an effective hedge is recognised directly in equity as other comprehensive income, with the ineffective portion being recognised in the consolidated income statement as finance income or cost. When the hedged commitment results in the recognition of an asset or a liability, then, at the time the asset or liability is recognised, the associated gains or losses that had previously been recognised in equity are included in the initial measurement of the acquisition cost or carrying amount of the asset or liability.

3) Hedge of a net investment in a foreign operation

Changes in the fair value of a derivative or nonderivative 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 transferred 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 objective and strategy for undertaking various hedge transactions. This process includes allocating all derivatives that are designated as fair value hedges, cash flow hedges or net investment hedges to specific assets and liabilities in the statement of financial position or to specific firm commitments or forecasted transactions. 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.

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; or
• 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.

Where the Group has transferred its rights to receive cash flows from an asset and has neither transferred nor retained substantially all the risks and rewards of the asset nor does transferred control of the asset, the asset continue to be recognised to the extent of the Group's continuing involvement in it. Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of the consideration that the Group could be required to repay.

Where continuing involvement takes the form of a written and/or purchased option (including cash-settled options or similar provision) on the transferred asset, the extent of the Group's continuing involvement is the amount of the transferred asset that the Group may repurchase, except that in the case of a written put option (including a cashsettled option or similar provision) on an asset measured at fair value, the extent of the Group's continuing involvement is limited to the lower of the fair value of the transferred asset and the option exercise price.

Offsetting financial instruments

Financial assets and liabilities are offset, and the net

amount reported in the balance sheet, 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 bankruptcy of the Company or the counterparty.

2) Financial liabilities

A financial liability is derecognised when the obligation under the liability 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 derecognition 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.

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 into a separate entity. The Group has no legal or constructive obligations to pay further contributions if the fund does not hold sufficient 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 contributions 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 remuneration in the form of share-based compensation transactions, whereby employees render services as consideration for equity instruments ('equity-settled transactions'). The cost of equity-settled transactions 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 Executive Incentive Compensation Plan ('EICP Plan'), and a Black Scholes Model for the Long-term Incentive Programme ('LTI'). Further details are given in Note 23. 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 performance 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-settled 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 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 (see Note 11).

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 liability. The fair value is determined using a binomial model, further details of which are given in Note 23.

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 21) and recorded at fair value. Subsequent changes in fair value are not recognised in equity. Coupons become payable whenever the Company makes dividend payments Coupon accruals are considered in the determination of earnings for calculating earnings per share (see Note 11).

Leases

The determination of whether an arrangement is, or contains, a lease is based on the substance of the arrangement at 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 consideration. Control is conveyed where the Group 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 payment 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.

The lease payments are discounted using the interest rate implicit in the lease, if that rate can be determined, or the Group's incremental borrowing rate. At the commencement of the lease the Group recognises a right-of-use asset and a lease liability. The lease liability is initially measured at present value of lease payments payable over the lease term, discounted at rate implicit in the lease. Lease payments 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 to a portfolio of leases with similar characteristics; and
• not accounting for leases ending within 12 months of the date of the initial application, or the underlying asset has a low value.

New standards and interpretations not yet adopted

A number of new standards and amendments to standards and interpretations are relevant for the Group and effective for annual periods beginning after 1 January 2018, and have not been early adopted in preparing these consolidated financial statements:

1) Amendments to IFRS 9, 'Financial instruments' on prepayment features with negative compensation

This amendment confirms that when a financial liability measured at amortised cost is modified without this resulting in derecognition, a gain or loss should be recognised immediately in profit or loss. The gain or loss is calculated as the difference between the original contractual cash flows and the modified cash flows discounted at the original effective interest rate. This means that the difference cannot be spread over the remaining life of the instrument which may be a change in practice from IAS 39. The effective date of these amendments is 1 January 2019. The Group does not expect any significant impact of these amendments on its consolidated financial statements.

2) Amendments to IAS 19, 'Employee benefits' on plan amendment, curtailment or settlement

These amendments require an entity to use updated assumptions to determine current service cost and net interest for the reminder of the period after a plan amendment, curtailment or settlement; and recognise in profit or loss as part of past service cost, or a gain or loss on settlement, any reduction in a surplus, even if that surplus was not previously recognised because of the impact of the asset ceiling. The effective date of these amendments is 1 January 2019. The amendment was not yet endorsed by EU. The Group does not expect any significant impact of these amendments on its consolidated financial statements.

3) Annual improvements 2015-2017 applicable for periods on or after 1 January 2019 (not yet endorsed by EU)

The annual improvements include minor amendments affecting IFRS 3, 'Business combinations', IFRS 11, 'Joint arrangements', IAS 12, 'Income taxes', and IAS 23, 'Borrowing costs'. The adoption of this amendment will not have any impact on the financial position and performance of the Group. The amendment was not yet endorsed by EU. The Group does not expect any significant impact of these amendments on its consolidated financial statements.

4) IFRIC 23, Uncertainty over income tax treatments

In June 2017, the IASB issued IFRIC 23 which clarifies how the recognition and measurement requirements of IAS 12 'Income taxes', are applied where there is uncertainty over income tax treatments. The interpretation explains how to recognise and measure deferred and current income tax assets and liabilities where there is uncertainty over a tax treatment. This standard is effective for annual periods beginning on or after 1 January 2019. The Group is currently assessing the impact of IFRIC 23.

5) Amendments to References to the Conceptual Framework in IFRS standards

The International Accounting Standards Board (IASB) has published its revised 'Conceptual Framework for Financial Reporting'. Included are revised definitions of an asset and a liability as well as new guidance on measurement and derecognition, presentation and disclosure. The new Conceptual Framework does not constitute a substantial revision of the document as was originally intended when the project was first taken up in 2004. The amendment was not yet endorsed by EU. The Group does not expect any significant impact of these amendments on its consolidated financial statements.

6) Amendment to IFRS 3 - Definition of a Business Combination

The IASB has issued 'Definition of a Business (Amendments to IFRS 3)' aimed at resolving the difficulties that arise when an entity determines whether it has acquired a business or a group of assets.

The amendments are effective for business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after 1 January 2020. The amendment was not yet endorsed by EU.

7) Amendment to IAS 1 and IAS 8 on the definition of material

The International Accounting Standards Board (IASB) has issued 'Definition of Material (Amendments to IAS 1 and IAS 8)' to clarify the definition of 'material' and to align the definition used in the Conceptual Framework and the standards themselves.

The amendments are effective for annual reporting periods beginning on or after 1 January 2020 and earlier application is permitted. The amendment was not yet endorsed by EU.

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:

In millions of euros	2018	2017
Borrowings - non-current	3,908.5	3,413.8
Borrowings - current	476.4	534.1
Borrowings, less	4,384.9	3,947.9
Cash and equivalents	909.1	269.6
Net debt	3,475.8	3,678.3

2) EBITDA and EBITDA margin

EBITDA is defined as profit for the period before the impact of depreciation, amortisation, net financing cost, income tax, the Group's share of the results of associates and discontinued operations and any extraordinary line item between revenue and profit before tax in the Group's consolidated income statement. EBITDA Margin is defined as EBITDA divided by revenue. 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:

In millions of euros	2018	2017
Profit before tax	244.8	467.3
Add: Depreciation and impairment expense	719.0	635.0
Add: Amortisation and impairment expense	145.4	78.6
Add: Net financing costs	146.3	143.3
EBITDA	1,255.5	1,324.2

The following table provides a reconciliation of EBITDA margin:

In millions of euros	2018	2017
Revenue	2,010.3	2,035.0
EBITDA	1,255.5	1,324.2
EBITDA Margin (%)	62.5%	65.1%

3) 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 statement line items from which it is derived:

In millions of euros	2018	2017
Profit before tax	244.8	467.3
Add: Net financing costs	146.3	143.3
Operating profit	391.1	610.6

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:

In millions of euros	2018	2017
Revenue	2,010.3	2,035.0
Operating profit	391.1	610.6
Operating profit margin	19.5%	30.0%

4) Net debt to EBITDA ratio

Net debt to EBITDA ratio is defined as net debt divided by EBITDA. The Group believes that net debt to EBITDA ratio is a useful measure to demonstrate to investors its ability to generate the income needed to be able to settle its loans and borrowings as they fall due.

The following table reconciles the net debt to EBITDA ratio to net debt and EBITDA:

In millions of euros	2018	2017
Net debt	3,475.8	3,678.3
EBITDA	1,255.5	1,324.2
Net debt to EBITDA ratio	2.77 times	2.78 times

5) Free cash flow before financing activities

Free cash flow before financing activities is defined as net operating cash flow less net cash absorbed by investing activities. Available free cash flow is used for the payment of dividends, the servicing and repayment of borrowings and other financing activities, and SES believes it is therefore a useful measure for investors.

The following table reconciles free cash flow before financing activities to the cash flow statement line items from which it is derived:

In millions of euros	2018	2017
Net cash generated by operating activities	1,191.3	1,251.2
Add: Net cash absorbed by investing activities	(320.8)	(490.4)
Free cash flow before financing activities	870.5	760.8

NOTE 3 - IMPLEMENTATION OF NEW INTERNATIONAL FINANCIAL REPORTING STANDARDS

This note explains the impact of the adoption of IFRS 9 'Financial Instruments', IFRS 15 'Revenue from Contracts with Customers' and IFRS 16 'Leases' on the Group's consolidated financial statements, and also discloses those new accounting policies that have been applied from 1 January 2018, where they are different to those applied in prior periods and are expected to have a material impact.

Summary impact on the consolidated financial statements

As a result of the adoption of the three new standards, opening balances as of 1 January 2018 in the consolidated statement of financial position had to be restated, consistent with the transitional provisions set out in the three standards. The impact of these adjustments on the statement of financial position as at 1 January 2018 is set out in the table below:

Statement of Finance Position (extract)	31 Dec 2017 as originally presented	IFRS 9	IFRS 15	IFRS 16	1 January 2018 restated
Non-current assets
Property, plant and equipment	4,591.4	-	-	46.8	4,638.2
Trade and other receivables	317.8	0.9	-	-	318.7
Deferred tax asset	70.4	0.9	3.4	-	74.7
Current assets
Trade and other receivables	648.2	(7.3)	-	-	640.9
Deferred customer contract costs	10.4	-	1.8	-	12.2
Total assets	12,184.4	(5.5)	5.2	46.8	12,230.9
Non-current liabilities
Lease liabilities	-	-	-	37.5	37.5
Current liabilities
Deferred income	443.2	-	14.0	-	457.2
Lease liabilities	-	-	-	9.3	9.3
Total liabilities	6,071.9	-	14.0	46.8	6,132.7
Net assets	6,112.5	(5.5)	(8.8)	-	6,098.2
Retained earnings	596.1	(5.5)	(8.8)	-	581.8
Total equity	6,112.5	(5.5)	(8.8)	-	6,098.2

IFRS 9 ('Financial Instruments') - Impact of adoption

IFRS 9 replaces IAS 39 relating to the recognition, classification and measurement of financial assets and financial liabilities, the derecognition of financial instruments, the impairment of financial assets, and hedge accounting.

Classification and measurement

The adoption of IFRS 9 has not affected the classification and measurement of financial assets. Group receivables represent contractual cash flows and their measurement remains at amortised cost. Similarly, derivative financial instruments used by the Group continue to be measured at fair value through the income statement. There was also no impact on the Group's accounting for financial liabilities, since the new requirements only affect the accounting for those financial liabilities measured at fair value through

the income statement and the Group does not have such liabilities.

IFRS 9 was adopted without restating comparative information. The adoption of IFRS 9 resulted in changes in the recognition principles in the area of impairment and adjustments to the opening balances recognised in the consolidated financial statements. In accordance with the transitional provisions in IFRS 9, comparative figures have not been restated, but rather have been recognised in the opening balance sheet on 1 January 2018 as set out in the table above.

All the Group's hedge relationships in place at the end of 2017 continue to qualify as hedges under IFRS 9 with hedge documentation in place aligned with the requirements of IFRS 9.

Impairment of financial assets

From 1 January 2018, the Group assesses on a forward-looking basis the expected credit losses associated with its debt instruments carried at amortised cost. The provisions for trade receivables as at 31 December 2017 reconcile to the opening provisions on 1 January 2018 as set out in the table above.

IFRS 15 ('Revenue from Contracts with Customers')

The adoption of IFRS 15 ('Revenue from Contracts with Customers') has resulted in certain changes in revenue recognition policies and adjustments to the opening balances recognised in the consolidated financial statements. The Group applied the standard using the modified retrospective approach which means that the cumulative impact of the adoption was recognised in retained earnings as of 1 January 2018 without the restatement of comparatives from 2017.

The total impact on the Group's retained earnings as at 1 January 2018 is set out in the table above.

The above impact of IFRS 15 is related only to the allocation of subscription revenue in connection with one of the services provided by HD Plus GmbH. These were previously recognised on a 'front-loaded' basis, matching the timing of the underlying operating expenses arising during the provision of the service. From 1 January 2018 the Group instead linearises both the subscription revenue and the associated operating costs over the 12-month term of the subscription agreement.

IFRS 16 ('Leases')

The adoption of IFRS 16 has resulted in changes in accounting policies and adjustments to the opening balances as of 1 January 2018 in the consolidated statement of financial position. The Group has applied the simplified transition approach as allowed by the standard, and therefore has not restated comparative closing 2017 amounts, but rather has adjusted the opening balance sheet as set out in the table above.

Specifically, the Group has recognised leased assets, and associated lease liabilities, in relation to contracts previously classified as 'operating leases' under the provisions of IAS 17. These assets and liabilities were measured at the present value of the remaining lease payments, discounted using the Group's weighted average incremental borrowing rate of 3.66% as at 1 January 2018.

The Group has applied the following practical expedients:

• applying a single discount rate to a portfolio of leases with similar characteristics; and
• not accounting for leases which end within 12 months from the date of the initial application or the underlying asset has a low value.

As at 31 December 2017, the Group had non-cancellable operating lease commitments of EUR 52.5 million, mainly in relation to office buildings and ground segment assets. The Group determined that only approximately 1% of these relate to payments for short-term and low-value leases which will continue to be recognised on a straight-line basis as an expense in the consolidated income statement over the duration of the agreements.

The amount of right-of-use assets and lease liabilities recorded as an adjustment to the opening balance sheet was EUR 46.8 million. The difference between the operating lease commitments and the right-of-use assets recognised represents impact of discounting over the outstanding lease term.

NOTE 4 - 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 Executive Committee, 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 Executive Committee in assessing the Group's performance and allocating resources are:

• analysis of the Group's revenues by two natural business units SES Video and SES Networks which comprises Fixed Data, Mobility and Government verticals;

• cost and overall Group's profitability development at the level of the entire business;
• internal and external analysis 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, the comparative prior year figures are analysed as reported and at 'constant FX' - recomputed using the exchange rates applying for each month in the current period.

The segment's financial results for 2018 are set out below:

In millions of euros	2018	2017	Change Favourable +/Adverse
Revenue	2,010.3	2,035.0	-1.2%
Operating expenses	(754.8)	(710.8)	-6.2%
EBITDA	1,255.5	1,324.2	-5.2%
EBITDA margin (%)	62.5%	65.1%	-2.6% pts
Depreciation and impairment expense	(719.0)	(635.0)	-13.2%
Amortisation and impairment expense	(145.4)	(78.6)	-85.0%
Operating profit	391.1	610.6	-36.0%

In millions of euros	2018	Constant FX 2017	Change Favourable +/Adverse
Revenue	2,010.3	1,977.4	+1.7%
Operating expenses	(754.8)	(689.0)	-9.5%
EBITDA	1,255.5	1,288.4	-2.6%
EBITDA margin (%)	62.5%	65.2%	-2.7% pts
Depreciation and impairment expense	(719.0)	(612.6)	-17.4%
Amortisation and impairment expense	(145.4)	(77.6)	-87.4%
Operating profit	391.1	598.2	-34.6%

Revenue by business unit

As reported and at constant FX, the revenue allocated to the relevant business units developed as follows:

In millions of euros	2018	2017	Constant FX 2017	Change Favourable + / Adverse	Change Favourable +/ Adverse (constant FX)
SES Video	1,306.3	1,383.0	1,356.1	-5.5%	-3.7%
Underlying1	1,292.1	1,373.2	1,346.3	-5.9%	-4.0%
Periodic2	14.2	9.8	9.8	+44.9%	+44.9%
SES Networks	695.7	646.1	616.1	+7.7%	+12.9%
Underlying1	671.1	606.6	579.8	+10.6%	+15.8%
Periodic2	24.6	39.5	36.3	-37.7%	-32.3%
Sub-total	2,002.0	2,029.1	1,972.2	-1.3%	+1.5%
Underlying1	1,963.2	1,979.8	1,926.1	-0.8%	+1.9%
Periodic2	38.8	49.3	46.1	-21.3%	-15.9%
Other3	8.3	5.9	5.2	+40.7%	+58.7%
Group Total	2,010.3	2,035.0	1,977.4	-1.2%	1.7%

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

Group Total	2,035.0	2,068.8	2,045.6	-1.6%	-0.5%
Other4, 5	5.9	49.9	49.9	-88.2%	-88.2%
SES Networks	646.1	627.3	614.4	+3.0%	+5.2%
SES Video	1,383.0	1,391.64	1,381.3	-0.6%	+0.1%
In millions of euros	2017	2016	Constant FX 2016	Change Favourable + / Adverse	Change Favourable +/ Adverse (constant FX)

4 During 2017, EUR 7.2 million of 2016 reported revenue was reclassified from SES Video to Other

5 Other includes revenue not directly applicable to SES Video or SES Networks

Revenue by category

The Group's revenue analysis from the point of view of category and timing can be found below:

2018
In millions of euros	Revenue recognised at a point in time	Revenue recognised over time	Total
Revenue from contracts with customers	-	1,906.7	1,906.7
Lease income	-	76.8	76.8
Other income	26.8	-	26.8
Total	26.8	1,983.5	2,010.3

2017

In millions of euros	Revenue recognised at a point in time	Revenue recognised over time	Total
Revenue from contracts with customers	-	1,921.5	1,921.5
Lease income	-	80.3	80.3
Revenue from sale of transponders	21.4	-	21.4
Other income	11.8	-	11.8
Total	33.2	2,001.8	2,035.0

Revenue by country

The Group's revenue from external customers analysed by country using the customer's billing address is as follows:

In millions of euros	2018	2017
Luxembourg (SES country of domicile)	59.5	40.5
United States of America	576.0	564.4
Germany	408.1	406.4
United Kingdom	279.1	283.5
France	99.3	91.9
Others	588.3	648.3
Total	2,010.3	2,035.0

No single customer accounted for 10%, or more, of total revenue in 2018, or 2017.

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 allocated to the country where the legal owner of the asset is incorporated.

In millions of euros	2018	2017
Luxembourg (SES country of domicile)	4,566.3	2,446.4
United States of America	2,808.1	2,711.5
Jersey	0.9	2,113.2
The Netherlands	1,543.5	1,462.9
Isle of Man	1,204.7	1,252.8
Israel	156.3	219.3
Sweden	176.7	195.3
Others	278.3	301.1
Total	10,734.8	10,702.5

NOTE 5 - OPERATING EXPENSES

The operating expense categories disclosed include the following types of expenditure:

1) Cost of sales, which excludes staff costs and depreciation, represents cost categories which generally vary directly with revenue. Such costs include the rental of thirdparty satellite capacity, customer support costs, such as

uplinking and monitoring, and other costs of sales such as equipment rental, engineering work, commissions, hardware and set-up costs.

In millions of euros	2018	2017
Rental of third-party satellite capacity	(89.8)	(102.9)
Customer support costs	(36.7)	(25.1)
Other cost of sales	(159.3)	(145.9)
Total cost of sales	(285.8)	(273.9)

• 2) Staff costs of EUR 305.7 million (2017: EUR 279.2 million) include gross salaries and employer's social security payments, payments into pension schemes for employees, and charges arising under share-based payment schemes. At the year-end the total full-time equivalent members of staff is 2,147 (2017: 2,015).
• 3) Other operating expenses in the amount of EUR 163.3 million (2017: EUR 157.7 million) are by their nature less variable to revenue development. Such costs include facility costs, in-orbit insurance costs, marketing expenses, general and administrative expenditure, consulting charges, travel-related expenditure and movements in provisions for debtors.

NOTE 6 - AUDIT AND NON-AUDIT FEES

For 2018 and 2017 the Group has recorded charges, billed and accrued, from its independent auditors and affiliated companies thereof, as set out below:

In millions of euros	2018	2017
Fees for statutory audit of annual and consolidated accounts	2.4	2.1
Fees charged for other assurance services	0.1	0.2
Fees charged for tax services	-	-
Fees charged for other non-audit services	0.1	-
Total audit and non-audit fees	2.6	2.3

Other assurance services represent primarily interim dividends reviews and contractual audits.

Tax services represent compliance and advisory services.

Other non-audit services represent primarily of comfort letters in relation to the bond issuances.

NOTE 7 - FINANCE INCOME AND COSTS

In millions of euros	2018	2017
Finance income
Interest income	11.6	1.1
Net foreign exchange gains1	5.1	-
Total	16.7	1.1
Finance costs
Interest expenses on borrowings (excluding amounts capitalised)	(127.3)	(111.0)
Loan fees and origination costs and other	(35.0)	(32.2)
Interest expense on lease liabilities	(0.7)	-
Net foreign exchange losses1	-	(1.2)
Total	(163.0)	(144.4)

1 Net foreign exchange gains /losses are mostly related to revaluation of bank accounts, deposits and other monetary items denominated in US dollar.

NOTE 8 - 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:

In millions of euros	2018	2017
Current income tax
Current income tax charge	(72.1)	(57.7)
Adjustments in respect of prior periods	(1.8)	28.7
Foreign withholding taxes	(9.9)	(3.4)
Total current income tax	(83.8)	(32.4)
Deferred income tax
Relating to origination and reversal of temporary differences	118.0	51.2
Relating to tax losses brought forward	(4.2)	17.5
Changes in tax rate	8.2	95.0
Adjustment of prior years	3.7	(0.7)
Total deferred income tax	125.7	163.0
Income tax benefit per consolidated income statement	41.9	130.6
Consolidated statement of changes in equity
Current and Deferred Income tax related to items (charged) or credited directly in equity
Post-employment benefit obligation	(0.2)	(0.3)
Impact of currency translation	(20.8)	60.3
Net investment hedge - current tax	21.2	(65.4)
Tax impact of the treasury shares impairment recorded in the statutory financial statements	(6.4)	14.2
Tax impact on perpetual bond	18.8	19.5
Current and deferred income taxes reported in equity	12.6	28.3

A reconciliation between the income tax benefit and the profit before tax of the Group multiplied by a theoretical tax rate of 26.76% (2017: 27.83%) which corresponds to

the Luxembourg domestic tax rate for the year ended 31 December 2018 is as follows:

In millions of euros	2018	2017
Profit before tax from continuing operations	244.8	467.3
Multiplied by theoretical tax rate	65.5	130.0
Effect of different foreign tax rates	7.6	(15.1)
Investment tax credits	(109.6)	(15.0)
Tax exempt income	(22.7)	(4.5)
Non-deductible expenditures	14.9	10.5
Taxes related to prior years	0.8	(7.1)
Effect of changes in tax rate	(21.8)	(3.4)
Change in deferred tax due to temporary differences related to prior years	12.0	7.7
Group tax provision related to current year	6.0	2.3
Release of Group tax provision	(1.1)	(17.7)
Extra-Territorial Income exclusion benefit	-	(56.7)
Impairment on subsidiaries	(17.7)	(23.8)
Impairment on intangible assets	14.6	-
Remeasurement of deferred taxes due to change in US tax law	(2.9)	(94.4)
Brazilian withholding tax refund	-	(51.1)
Foreign withholding taxes	9.9	3.4
Other	2.6	4.3
Income tax reported in the consolidated income statement	(41.9)	(130.6)

Effect of changes in tax rate

During 2018, reflecting a decrease in the Dutch corporate income tax rate from 25% to 22.55% effective in January 2020 and from 22.55% to 20.5% effective in January 2021, the relevant deferred tax assets and liabilities balances have been re-measured. The total impact of the re-measurement was an income tax benefit of EUR 22 million.

Similar changes in the Swedish corporate income tax rate which will decrease from 22% to 21.4% in January 2020 and from 21.4% to 20.6% in January 2021 resulted in the re-measurement of the associated deferred tax assets and liabilities balances. The total impact of re-measurement was a net tax income of EUR 2.1 million.

All the above re-measurements were considered changes in accounting estimate in accordance with IAS 8 requirements.

During 2017, as a result of the change in the US corporate income tax rate from 35% to 21% effective as of 1 January 2018, the relevant deferred tax assets and liabilities balances have been re-measured. The total impact of re-measurement was an income tax benefit of EUR 94.4 million.

Foreign withholding tax

The foreign withholding tax of EUR 9.9 million includes tax provision of EUR 8.8 million booked for withholding tax refunds in India following the favourable outcome of the High Court hearings in 2017. A corresponding provision was recorded pending the final decision at the level of the Supreme Court.

Change in US tax law

The United States Tax Cuts and Jobs Act ('the Act') which was signed into law on 22 December 2017, introduced significant changes in the US tax laws which took effect in January 2018. The Group performed a preliminary assessment of the impact of the Act on the current and deferred tax balances in the consolidated financial statements as of 31 December 2017 and estimated the impact disclosed above under 'Effect of changes in tax rate' as well as EUR 2 million increase in current income tax payable and current income tax expense, representing toll charge. Further to a final assessment of the impact of the Act, an additional tax benefit of EUR 2.9 million was recorded in 2018.

Investment tax credits

Following the completion of 100% acquisition of O3b in 2016 and subsequent reorganisation, the O3b business was transferred from Jersey to Luxembourg in May 2018. This transfer triggered the recognition of EUR 74.9 million of investment tax credits in Luxembourg of which EUR 23.5 million was booked as current tax and EUR 51.4 million was booked as a deferred tax asset. Additionally, a deferred tax asset of EUR 6.8 million was recognised on goodwill crystallising on the transfer to Luxembourg.

GovSat-1 was successfully launched on 31 January 2018 and entered in operational service on 28 March 2018. The favourable LuxGovSat business plan projections triggered the recognition of a deferred tax asset for investment tax credits of EUR 25.8 million.

Impairment on subsidiaries

The impairment on subsidiaries booked in Luxembourg for a total of EUR 66.5 million gave rise to a tax benefit of EUR 17.7 million.

Impairment on intangible assets

The impairment charge of EUR 63.3 million relating to the MX1 CGU resulted in a negative ETR impact of EUR 14.6 million.

NOTE 9 - DEFERRED INCOME TAX

The deferred taxes positions included in the consolidated financial statements can be analysed as follows:

In millions of euros	Deferred tax assets 2018	Deferred tax assets 2017	Deferred tax liabilities 2018	Deferred tax liabilities 2017
Losses carried forward	32.3	33.5	-	-
Tax credits	96.7	6.0	-	-
Intangible assets	38.3	37.7	(215.9)	(218.6)
Tangible assets	-	-	(213.4)	(244.3)
Employee benefits	7.8	10.0	-	-
Receivables	17.8	21.0	-	-
Other	0.7	1.1	(14.5)	(14.5)
Total deferred tax assets / (liabilities)	193.6	109.3	(443.8)	(477.4)
Offset of deferred taxes	(31.3)	(38.9)	31.3	38.9
Net deferred tax assets/ (liabilities)	162.3	70.4	(412.5)	(438.5)

Deferred tax assets have been offset against deferred tax liabilities where they relate to the same taxation authority and the entity concerned has a legally enforceable right to set off current tax assets against current tax liabilities.

In addition to the recoverable tax losses for which the Group has recognised deferred tax assets, the Group has further tax losses of EUR 569.9 million as at 31 December 2018 (31 December 2017: EUR 490.8 million) that are available for offset against future taxable profits of the companies in which the losses arose. EUR 478.0 million (31 December 2017: 450.7 million) of tax losses are triggered by the change in state apportionment rules in the US. Deferred tax assets have not been recognised in respect of these losses as they may not be used to offset taxable profits elsewhere in the Group and they have arisen in subsidiaries that are not expected to generate taxable profits against which these losses could be offset in the foreseeable future.

No deferred income tax liabilities have been recognised for the withholding 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:

Deferred tax assets	Losses carried forward	Tax credits	Intangible assets	Employee benefits	Measurement of financial assets and derivatives	Receivables	Other	Total
At 1 January 2017	40.8	6.5	41.4	15.6	1.1	14.4	1.2	121.0
(Charged)/credited to the income statement	(3.9)	(0.5)	(3.7)	(3.9)	(0.8)	8.8	(0.1)	(4.1)
Charged directly to equity		-	-	(0.4)	(0.1)	-	-	(0.5)
Exchange difference1	(3.4)	-	-	(1.3)	(0.2)	(2.2)	-	(7.1)
At 31 December 2017	33.5	6.0	37.7	10.0	-	21.0	1.1	109.3
Changes in accounting policies	-	-	-	-	-	4.3	-	4.3
(Charged)/credited to the income statement	(2.1)	89.7	0.8	(2.6)	0.1	(8.0)	(0.5)	77.4
Charged directly to equity	-	-	-	(0.2)	-	-	-	(0.2)
Exchange difference1	0.9	1.0	(0.2)	0.6	-	0.5	-	2.8
At 31 December 2018	32.3	96.7	38.3	7.8	0.1	17.8	0.6	193.6

				Measurement of financial
Deferred tax liabilities	Intangible assets	Tangible assets	Tax-free reserves	instruments	Other	Total
At 1 January 2017	294.1	401.4	3.9	-	15.3	714.7
Charged/(credited) to the income statement	(46.5)	(116.8)	(3.4)	-	(0.4)	(167.1)
Exchange difference1	(29.0)	(40.3)	(0.5)	-	(0.4)	(70.2)
At 31 December 2017	218.6	244.3	-	-	14.5	477.4
Charged/(credited) to the income statement	(13.0)	(35.3)	-	-	-	(48.3)
Exchange difference1	10.3	4.4	-	-	-	14.7
At 31 December 2018	215.9	213.4	-	-	14.5	443.8

1 A foreign exchange impact arises due to the translation of Group's operations with a different functional currency than euro. This amounts to EUR 11.9 million as at 31 December 2018 (2017: EUR 63.1 million)

NOTE 10 - COMPONENTS OF OTHER COMPREHENSIVE INCOME

In millions of euros	2018	2017
Impact of currency translation	345.2	(1,050.9)
Income tax effect	(20.8)	60.3
Total impact of currency translation, net of tax	324.4	(990.6)

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 euro, which is the Company's functional and presentation currency. The assets and liabilities of consolidated foreign operations are translated 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 unrealised gain in 2018 reflects the impact on the valuation of SES's net US dollar assets of the strengthening of the US dollar against the euro from 1.1993 to 1.1450 (compared to significant unrealised loss in 2017 reflecting the impact on the valuation of SES's net US dollar assets of the weakening of the US dollar against the euro from 1.0541 to 1.1993). This effect is partially offset by the impact of the net investment hedge (Note 19).

NOTE 11 - 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 for the year attributable to ordinary shareholders has been adjusted to include an assumed coupon, net of tax, on the perpetual bond.

For the year 2018, basic earnings per share of EUR 0.54 per Class A share (2017: EUR 1.21), and EUR 0.22 per Class B share (2017: EUR 0.48) have been calculated on the following basis:

Profit attributable to the owners of the parent for calculating basic earnings per share was as follows:

In millions of euros	2018	2017
Profit attributable to owners of the parent	292.4	596.1
Assumed coupon on perpetual bond (net of tax)	(48.1)	(47.3)
Total	244.3	548.8

Assumed coupon accruals of EUR 48.1 million (net of tax) for the year ended 31 December 2018 (2017: EUR 47.3 million) related to the perpetual bonds issued during 2016 have been considered for the calculation of the basic and diluted earnings available for distribution.

Weighted average number of shares, net of own shares held, for calculating basic earnings per share were as follows:

	2018	2017
Class A shares (in million)	376.4	376.5
Class B shares (in million)	191.7	191.7
Total	568.1	568.2

The weighted average number of shares is based on the capital structure of the Company as described in Note 21.

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 determine 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 effective, is considered to adjust the weighted average number of share.

For the year 2018, diluted earnings per share of EUR 0.54 per Class A share (2017: EUR 1.21), and EUR 0.21 per Class B share (2017: EUR 0.48) have been calculated on the following basis:

In millions of euros	2018	2017
Profit attributable to owners of the parent	292.4	596.1
Assumed coupon on perpetual bond (net of tax)	(48.1)	(47.3)
Total	244.3	548.8

The weighted average number of shares, net of own shares held, for calculating diluted earnings per share was as follows:

	2018	2017
Class A shares (in million)	379.0	377.7
Class B shares (in million)	191.7	191.7
Total	570.7	569.4

NOTE 12 - DIVIDENDS PAID AND PROPOSED

Dividends declared and paid during the year:

In millions of euros	2018	2017
Class A dividend for 2017: EUR 0.80 (2016: EUR 1.34)	306.8	513.8
Class B dividend for 2017: EUR 0.32 (2016: EUR 0.54)	61.4	102.8
Total	368.2	616.6

Dividends declared are paid net of any withholding tax (2018: EUR 35.7 million, 2017: EUR 61.0 million).

Dividends proposed for approval at the annual general meeting to be held on 4 April 2019, which are not recognised as a liability as at 31 December 2018:

In millions of euros	2019	2018
Class A dividend for 2018: EUR 0.80 (2017: EUR 0.80)	306.8	306.8
Class B dividend for 2018: EUR 0.32 (2017: EUR 0.32)	61.4	61.4
Total	368.2	368.2

NOTE 13 - PROPERTY, PLANT AND EQUIPMENT

		Other fixtures and fittings, Land and buildings Space segment Ground Segment
In millions of euros				tools and equipment	Total
Cost
As at 1 January 2018	239.8	10,410.2	652.7	173.6	11,476.3
Adoption of IFRS 161	36.6	-	8.1	2.1	46.8
Additions	0.7	0.7	16.1	2.3	19.8
Disposals	-	(11.8)	(2.2)	-	(14.0)
Retirements	(1.1)	(0.1)	(18.9)	(2.0)	(22.1)
Transfers from assets in course of construction (Note 14)2	-	955.4	85.6	12.5	1,053.5
Transfer	0.1	(1.8)	(13.8)	10.4	(5.1)
Impact of currency translation	5.4	323.9	24.7	1.2	355.2
As at 31 December 2018	281.5	11,676.5	752.3	200.1	12,910.4
Depreciation
As at 1 January 2018	(144.0)	(6,203.9)	(414.9)	(122.1)	(6,884.9)
Depreciation	(17.4)	(529.4)	(62.8)	(16.3)	(625.9)
Impairment	-	(93.1)	-	-	(93.1)
Disposals	-	-	2.2	-	2.2
Retirements	1.1	0.1	18.9	2.0	22.1
Transfer	-	-	1.5	(1.5)	-
Impact of currency translation	(2.6)	(201.5)	(17.8)	(2.0)	(223.9)
As at 31 December 2018	(162.9)	(7,027.8)	(472.9)	(139.9)	(7,803.5)
Net book value as at 31 December 2018	118.6	4,648.7	279.4	60.2	5,106.9

1 Represents impact of the adoption of new International Financial Reporting Standards (Note 3).

2 SES-15, SES-14, SES-16 and O3b satellites 13-16 became operational during 2018.

In millions of euros	Land and buildings	Space segment	Ground Segment	Other fixtures and fittings, tools and equipment	Total
Cost
As at 1 January 2017	244.9	11,186.3	653.3	166.4	12,250.9
Additions	5.3	126.93	24.4	9.7	166.3
Additions through business combinations	-	14.8	-	-	14.8
Disposals	(0.7)	-	(0.6)	(3.0)	(4.3)
Retirements	-	(247.3)4	(5.8)	(1.0)	(254.1)
Transfers from assets in course of construction (Note 14)	2.5	248.35	26.0	8.2	285.0
Transfer	0.9	-	(0.9)	-	0.0
Other movements	-	-	6.0	-	6.0
Impact of currency translation	(13.1)	(918.8)	(49.7)	(6.7)	(988.3)
As at 31 December 2017	239.8	10,410.2	652.7	173.6	11,476.3
Depreciation
As at 1 January 2017	(140.4)	(6,442.3)	(394.6)	(117.3)	(7,094.6)
Depreciation	(9.9)	(512.4)	(57.7)	(14.7)	(594.7)
Impairment	-	(40.3)	-	-	(40.3)
Disposals	-	-	-	3.0	3.0
Retirements	-	247.34	5.8	1.0	254.1
Transfer	-	-	(0.9)	0.9	-
Impact of currency translation	6.3	543.8	32.5	5.0	587.6
As at 31 December 2017	(144.0)	(6,203.9)	(414.9)	(122.1)	(6,884.9)
Net book value as at 31 December 2017	95.8	4,206.3	237.8	51.5	4,591.4

3 SE.S-11 became operational during 2017

4 AMC-9 was retired in 2017

5 SES-10 became operational during 2017

As at 31 December 2018, the amount of the property, plant and equipment pledged in relation to the Group's liabilities is nil (2017: nil).

Impairment for space segment

In 2018, the impairment charge for space segment assets recorded was EUR 93.1 million.

The following table discloses the impairment charge and related assumptions used in the impairment test for the satellites presenting impairment indicators.

In millions of euros	Impairment charge	Recoverable Amount	Discount Rate (pre-tax)	Previous estimate of value in use ('VIU')	Nature of the asset
Ciel-2	42.9	41.1 VIU	9.07%	139.1	Satellite serving DTH market in North America
ASTRA 5B	34.3	177.3 VIU	6.79%	236.9	Satellite serving Eastern Europe
YahSat 1A	6.0	45.2 VIU	9.07%	173.5	Satellite serving MENA and Southwest Asia
NSS-10	4.4	12.5 VIU	9.07%	42.6	Satellite serving Americas, Africa, and Europe
Total	87.6

For Ciel-2, the impairment was caused by an extension of the contract with Ciel-2's lone customer agreed in November 2018. For ASTRA 5B and YahSat 1A, the impairment was caused by a reassessment of the future revenues to be achieved in the markets served by those satellites. For NSS-10, the impairment was caused by a reassessment of the future revenues to be achieved on the satellite as it approaches its end of life.

In addition, an impairment charge of EUR 5.5 million was recorded on AMC-10 due to technical deterioration of that satellite.

In 2017, the corresponding charge was EUR 40.3 million driven by a EUR 38.4 million impairment on AMC-9 resulting from a significant anomaly on the satellite which led to its de-orbiting and brought its net book value to zero.

Procurement of SES-11

In connection with the acquisition of the SES-11 satellite, the Group entered into an agreement with an anchor customer on one of the payloads of the satellite whereby the anchor customer entered into the construction agreement with the manufacturer to construct the satellite. Some of the payload construction costs were treated as an advance payment for the services to be provided to that customer over the duration of the customer agreement, with the remainder to be paid by the Group to the anchor customer in cash. As at 31 December 2018, the balance of EUR 101.4 million (2017: EUR 105.5 million) was included in the Group's deferred revenue.

As a result of this arrangement, the Group recognised EUR 106.2 million (USD 127.4 million) of deferred revenue at the satellite's in-service date in November 2017, and paid EUR 66.2 million (USD 79.4 million) in cash to the anchor customer in January 2018. For this reason, both of these amounts are included in the Group's space segment as at 31 December 2017 and are excluded from 'Payments for purchases of tangible assets' within consolidated statement of cash flows. There were no non-cash transactions in 2018.

NOTE 14 - ASSETS IN THE COURSE OF CONSTRUCTION

In millions of euros	Land and Buildings	Space segment	Ground segment	Fixtures, tools & equipment	Total
Cost and net book value as at 1 January 2018	0.2	1,388.3	81.5	10.2	1,480.2
Movements in 2018
Additions	-	359.5	71.6	9.4	440.5
Transfers to assets in use (Note 13)	-	(955.4)	(85.6)	(12.5)	(1,053.5)
Impact of currency translation	-	38.6	1.3	0.3	40.2
Cost and net book value as at 31 December 2018	0.2	831.0	68.8	7.4	907.4
In millions of euros	Land and Buildings	Space segment	Ground segment	Fixtures, tools & equipment	Total
Cost and net book value as at 1 January 2017	2.6	1,335.0	47.1	4.9	1,389.6
Movements in 2017
Additions	0.1	415.1	66.3	14.0	495.5
Transfers to assets in use (Note 13)	(2.5)	(248.3)1	(26.0)	(8.2)	(285.0)
Impact of currency translation	-	(113.5)	(5.9)	(0.5)	(119.9)
Cost and net book value as at 31 December 2017	0.2	1,388.3	81.5	10.2	1,480.2

1 Includes SES-15 that became operational in January 2018

Borrowing costs of EUR 42.3 million (2017: EUR 47.0 million) arising from financing 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 capitalisation rate of 3.90% (2017: 3.97%) was used, representing the Group's average weighted cost of borrowing. Excluding the impact of the loan origination costs and commitment fees the average weighted interest rate was 3.62% (2017: 3.66%).

During 2018 the Group recognised EUR 174.1 million additions in respect of the mPOWER arrangement described in Note 28. Due to the nature of the arrangement, this transaction is included in the Group's assets in the course of construction space segment and is excluded from 'Payments for purchases of tangible assets' within consolidated statement of cash flows.

NOTE 15 - INTANGIBLE ASSETS

In millions of euros	Orbital slot licence rights (indefinite-life)	Goodwill	Orbital slot licence rights (definite life)	Other definite life intangibles	Internally generated development costs	Total
Cost
As at 1 January 2018	1,972.1	2,243.9	772.4	387.8	26.5	5,402.7
Additions	0.8	-	-	7.7	30.6	39.1
Transfers	-	-	-	3.8	1.3	5.1
Transfers from assets in course of construction	0.8	-	(1.4)	32.6	(32.0)	-
Impact of currency translation	84.4	103.6	(1.2)	8.7	0.2	195.7
As at 31 December 2018	2,058.1	2,347.5	769.8	440.6	26.6	5,642.6
Amortisation
As at 1 January 2018	-	-	(511.4)	(260.4)	-	(771.8)
Amortisation	-	-	(38.0)	(44.1)	-	(82.1)
Impairment		(63.3)	-	-	-	(63.3)
Transfers	-	-	0.4	(0.4)	-	-
Impact of currency translation	-	-	-	(4.9)	-	(4.9)
As at 31 December 2018	-	(63.3)	(549.0)	(309.8)	-	(922.1)
Book value as at 31 December 2018	2,058.1	2,284.2	220.8	130.8	26.6	4,720.5
	Orbital slot licence		Orbital slot licence	Other definite life	Internally generated
In millions of euros	rights (indefinite-life)	Goodwill	rights (definite life)	intangibles	development costs	Total
Cost
As at 1 January 2017	2,232.7	2,540.9	770.3	406.5	6.2	5,956.6
Additions	0.3	-	-	10.4	25.4	36.1
Additions through business combinations	-	5.6	-	-	-	5.6
Transfers	(5.5)	-	5.5	4.5	(4.5)	-
Disposals	-	-	-	(1.7)	-	(1.7)
Other movements	-	-	-	(6.0)	-	(6.0)
Impact of currency translation
	(255.4)	(302.6)	(3.4)	(25.9)	(0.6)	(587.9)
As at 31 December 2017	1,972.1	2,243.9	772.4	387.8	26.5	5,402.7
Amortisation
As at 1 January 2017	-	-	(473.4)	(235.5)	-	(708.9)
Amortisation	-	-	(38.7)	(39.9)	-	(78.6)
Disposals	-	-	-	1.7	-	1.7
Impact of currency translation As at 31 December 2017	- -	- -	0.7 (511.4)	13.3 (260.4)	- -	14.0 (771.8)

Book value as at 31 December 2017	1,972.1	2,243.9	261.0	127.4	26.5	4,630.9

Indefinite-life intangible assets

The Group's indefinite-life intangibles include goodwill and orbital slot licence rights.

Impairment testing procedures are performed at least once a year to assess whether the carrying values of intangible assets are still appropriate. The annual impairment tests are performed as at 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-todate assumptions concerning the CGU's markets and also developments and trends in the business 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 the replacement capacity;
• any changes in the expected capital expenditure cycle - due to technical degradation of a satellite or through the identified need for replacement capacities; and
• any changes in satellite procurement, launch or cost assumptions, including launch schedule.

2) Changes in discount rates

Discount rates reflect management's estimate of the risks specific to each CGU. Management uses a pre-tax weighted average cost of capital as discount rate for each CGU. This reflects market 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) Perpetuity growth rates

Growth rate assumptions used to extrapolate cash flows beyond the business planning period are based on the commercial experience relating to the CGUs concerned and the expectations for developments in the markets which they serve.

Goodwill

Management identified the following CGUs at the level of which goodwill is allocated: SES GEO operations, SES MEO operations, MX1 and other.

The level of integration of SES GEO operations has lead management to conclude that it represents a single CGU to which the goodwill is allocated for impairment test purposes. SES MEO operations, representing the O3b Networks business acquired in 2016, is considered a separate CGU, as the business generates cash inflows that are currently largely independent from SES's GEO operations (see Note 2). Similarly, MX1 generates separate cash flows and is considered a separate CGU.

For the MEO CGU, the impairment test period was extended beyond the five-year period, to 2034, reflecting the ramp-up phase of the business. This extension is necessary to fully capture the contracted capital expenditure and expected growth of the business in connection with the O3b mPOWER constellation, which is expected to launch in 2021, as well as properly reflect the timing of the replacement capital expenditure.

The pre-tax discount rates for each CGU are presented below:

	2018	2017
SES GEO operations	8.40%	8.10%
SES MEO operations	10.21%	10.37%
MX1	8.66%	7.93%

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 rate used in the valuations is 2% (2017: 2%), which reflects the most recent long-term planning assumptions approved by the Board of Directors and can be supported by reference to the trading performance of the companies concerned over a longer period.

As a result of the impairment tests conducted as of 31 December 2018, the Group recorded an impairment charge of EUR 63.3 million relating to the MX1 CGU. The MX1 CGU represents SES's media services business, comprised of the legacy SES Platform Services business in Germany and the legacy RR Media business in Israel, which were brought together following the acquisition of RR Media in 2016. The impairment reflects business developments over the past year, most notably increased competition for MX1's services and the profitability of those services. The recoverable amount, representing the value in use, is EUR 292.4 million, reflecting the pre-tax discount rate of 8.66%. The previous estimate of value in use was EUR 709.8 million.

There were no impairment charges on goodwill recorded for the year ending 31 December 2017.

The goodwill has a net book value as at 31 December 2018 and 2017 by CGU as presented below:

In millions of euros	2018	2017
SES GEO operations	2,016.4	1,926.9
SES MEO operations	150.1	142.6
MX1	111.8	169.2
Other (SES GS)	5.9	5.2
Total	2,284.2	2,243.9

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 CGU's specific rate used in the base valuation. In this way a matrix of valuations is generated which reveals the potential exposure to impairment charges for each CGU 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 the SES MEO and MX1 CGUs would have an impairment in the least favourable case - a combination of lower terminal growth rates and higher discount rates. In this least favourable case, the SES MEO CGU would have an impairment of EUR 192.6 million and the MX1 CGU would have an additional impairment of EUR 67.5 million. There would be no impairment in the SES GEO CGU. Unfavourable changes in the factors listed above under 'Movements in the underlying business plan assumptions', in combination with unfavourable changes in discount rates and perpetuity growth rates, would increase these impairments.

Taken separately from changes in discount and perpetuity growth rates, a 5% reduction in EBITDA would not lead to an impairment charge in the SES GEO or SES MEO CGUs. A 5% reduction in EBITDA would increase the impairment charge in the MX1 CGU by EUR 27.1 million.

Taken separately from changes in discount rates, perpetuity growth rates and EBITDA, for SES MEO, a delay in the launch of the mPOWER constellation by one year would not lead to an impairment charge.

Orbital slot licence rights

The rights conveyed by orbital slot licences in different jurisdictions can have varying characteristics that make them separate and distinct from the orbital slot licence rights in other jurisdictions. For this reason, the Group aggregates the GEO orbital slot licence rights in Europe, the U.S., Canada, and Mexico into separate CGUs. All other GEO orbital slot licence rights are not separable and do not generate separate cash flows, and thus are considered a single CGU, "International". 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 impairment together with the related corresponding goodwill and the MEO satellites constellation.

The pre-tax discount rates for each CGU are presented below:

	2018	2017
SES MEO operations	10.21%	10.37%
Europe	9.40%	9.10%
U.S., Canada, Mexico, and International	11.10%	10.22%

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 rate used in the valuations is 2% (2017: 2%), which reflects the most recent long-term planning assumptions approved by the Board of Directors and can be supported by reference to the trading performance of the companies concerned over a longer period.

There were no impairment charges on orbital slot licence rights recorded for the year ending 31 December 2018 or 2017.

The orbital slot license rights have a net book value as at 31 December 2018 and 2017 by CGU as presented below:

In millions of euros	2018	2017
MEO operations	1,113.0	1,062.9
Europe	151.1	154.0
U.S.	315.4	301.2
Canada	6.4	5.4
Mexico	6.8	6.5
International	465.4	442.1
Total	2,058.1	1,972.1

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 valuation. In this way a matrix of valuations is generated which reveals the potential exposure to impairment charges 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 lead to impairment charges of EUR 69.2 million in the International CGU and EUR 5.8 million in the U.S. CGU.

Definite life intangible assets

The definite-life intangible assets as at 31 December 2018 have a net book value by CGU as presented below:

In millions of euros		2018
	Orbital slot licence rights	Other
Luxembourg	204.1	44.6
Israel	-	53.8
Brazil	11.5	1.1
Other	5.2	31.3
Total	220.8	130.8

The definite-life intangible assets as at 31 December 2017 have a net book value by CGU presented below:

In millions of euros		2017
	Orbital slot licence rights	Other
Luxembourg	241.3	34.1
Israel	-	61.2
Brazil	13.3	1.3
Other	6.4	30.8
Total	261.0	127.4

The Group's primary definite life intangible asset is the agreement concluded by SES ASTRA with the Luxembourg government in relation to the usage of Luxembourg frequencies in the orbital positions 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 EUR 550.0 million at the date of acquisition - are being amortised on a straightline basis over the 21-year term of the agreement.

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 2018, the amount of the intangible assets pledged in relation to the Group's liabilities is nil (2017: nil).

NOTE 16 - ASSETS AND LIABILITIES RELATED TO CONTRACTS WITH CUSTOMERS

The Group has recognised the following assets and liabilities related to contracts with customers:

In millions of euros	2018	2017
Current contract assets
Trade debtors	509.5	494.6
Provision for trade debtors	(66.4)	(49.8)
Trade debtors, net of provisions	443.1	444.8
Unbilled accrued revenue	111.9	116.6
Provision for unbilled accrued revenue	(13.6)	(4.0)
Unbilled accrued revenue, net of provisions	98.3	112.6
Deferred customer contract costs	17.5	10.4
	558.9	567.8
Non-current contract assets
Unbilled accrued revenue	306.2	335.8
Provision for unbilled accrued revenue	(11.7)	(18.0)
Unbilled accrued revenue, net of provisions	294.5	317.8
Deferred customer contract costs	10.3	15.2
	304.8	333.0
Current contract liabilities
Deferred income	476.1	443.2
Non-current contract liabilities
Deferred income	370.3	477.3

The following table shows the movement in deferred income recognised by the Group:

In millions of euros	Non-current	Current
As at 1 January 2018	477.3	443.2
Adoption of IFRS 15 (Note 3)	-	14.0
Revenue recognised during the year	-	(1,377.3)
New billings	-	1,285.8
Other movements1	(113.7)	101.1
Impact of currency translation	6.7	9.3
As at 31 December 2018	370.3	476.1

1 Other movements include reclassifications (between current and non-current, upfront and deferred, as well as against receivable)

In millions of euros	Non-current	Current
As at 1 January 2017	411.8	510.5
Movement on deferred revenue	79.6	(41.3)
Impact of currency translation	(14.1)	(26.0)
As at 31 December 2017	477.3	443.2

NOTE 17 - TRADE AND OTHER RECEIVABLES

In millions of euros	2018	2017
Trade receivables, net of provisions	443.1	444.8
Unbilled accrued revenue, net of provisions	392.8	430.4
Other receivables	72.8	90.8
Total trade and other receivables	908.7	966.0
Of which:
Non-current	294.5	317.8
Current	614.2	648.2

Unbilled accrued revenue represents revenue recognised, but not billed, for satellite capacity under long-term contracts. Billing will occur based on the terms of the contracts. There is a current and non-current portion for unbilled accrued revenue. The non-current portion amounts to EUR 294.5 million (2017: EUR 317.8 million).

An amount of EUR 25.0 million (2017: EUR 32.4 million) was expensed in 2018 reflecting an increase in the impairment of trade and other receivables. This amount is recorded in 'Other operating charges'. As at 31 December 2018, trade and other receivables with a nominal amount of EUR 91.7 million (2017: EUR 71.8 million) were impaired and fully provided for. Movements in the provision for the impairment of trade and other receivables were as follows:

In millions of euros 2018	2017
As at 1 January 71.81	57.71
Adoption of IFRS 9 (Note 3) 6.4	-
Increase in provision 45.6	32.4
Reversals of provision (20.6)	(7.3)
Utilised (14.5)	(3.6)
Impact of currency translation 3.0	(7.4)
As at 31 December 91.7	71.81

1 Certain comparative balances have been reclassified to conform to current year presentation

NOTE 18 - 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:

• 1) Quoted prices in active markets for identical assets or liabilities (Level 1);
• 2) Other techniques for which all inputs which have a significant effect on the recorded fair value are observable either directly or indirectly (Level 2);
• 3) Techniques which use inputs which have a significant effect on the recorded fair value that are not based on observable market data (Level 3).

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'slength market transactions; reference to the current market value of another instrument, which is substantially the same; discounted cash flow analysis and option pricing models.

Set out below is an analysis of financial derivatives by category (all measured at fair value valuation technique Level 2):

	2018		2017
In millions of euros	Fair value asset	Fair value liability	Fair value asset	Fair value liability
Derivatives:
Forward currency exchange contracts	-	-	0.6	-
Interest rate swaps	0.2	0.1	2.0	0.6
Total valuation of financial derivatives	0.2	0.1	2.6	0.6
Of which: Non-current	-	-	-	-
Of which: Current	0.2	0.1	2.6	0.6

Fair values

The fair value of borrowings has been calculated with the quoted market prices except for COFACE, Fixed Term Loan Facility (LuxGovSat) 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 calculated 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.

Set out below is a comparison by category of carrying amounts and fair values of all of the Group's financial instruments that are carried in the financial statements.

As at 31 December 2018

		Carried at amortised cost		Carried at fair value	Total
In millions of euros	Fair value hierarchy	Carrying amount	Fair value	Carrying amount	Balance Sheet
As at 31 December 2018
Financial assets
Non-current financial assets:
Other financial assets		6.5	6.5	-	6.5
Trade and other receivables		294.5	294.5	-	294.5
Total non-current financial assets		301.0	301.0	-	301.0
Current financial assets:
Trade and other receivables		614.2	614.2	-	614.2
Derivatives	2	-	-	0.2	0.2
Cash and cash equivalents		909.1	909.1	-	909.1
Total current financial assets		1,523.3	1,523.3	0.2	1,523.5
Financial liabilities
Borrowings:
At floating rates:
Syndicated loan 20211	2	-	-	-	-
COFACE	2	160.8	161.1	-	160.8
German Bond 2024 (EUR 150 million), non-listed	2	149.4	145.5	-	149.4
At fixed rates:
US Bond 2019 (USD 500 million)	2	435.2	434.2	-	435.2
Eurobond 2020 (EUR 650 million)	2	649.1	684.2	-	649.1
Eurobond 2021 (EUR 650 million)	2	648.4	708.5	-	648.4
US Bond 2023 (USD 750 million)	2	653.4	640.0	-	653.4
German Bond 2025 (EUR 250 million), non-listed	2	249.0	244.4	-	249.0
Eurobond 2026 (EUR 500 million)	2	494.1	477.6	-	494.1
US Bond 2043 (USD 250 million)	2	213.6	185.1	-	213.6
US Bond 2044 (USD 500 million)	2	427.5	371.3	-	427.5
German Bond 2032 (EUR 50 million), non-listed	2	49.8	61.0	-	49.8
Euro Private Placement 2027 (EUR 140 million)
issued under EMTN	2	139.6	168.5	-	139.6
Fixed Term Loan Facility (LuxGovSat)	2	115.0	122.8	-	115.0
Total borrowings		4,384.9	4,404.2	-	4,384.9
Non-current financial liabilities:		4,271.9	4,289.1	-	4,271.9
Non-current borrowings		3,908.5	3,925.7	-	3,908.5
Lease liabilities		28.6	28.6		28.6
Fixed assets suppliers		200.9	200.9	-	200.9
Other long term liabilities		133.9	133.9	-	133.9
Current financial liabilities:		984.2	986.3	0.1	984.3
Current borrowings		476.4	478.5	-	476.4
Lease liabilities		9.5	9.5	-	9.5
Fixed assets suppliers		130.8	130.8	-	130.8
Derivatives	2	-	-	0.1	0.1
Trade and other payables		367.5	367.5	-	367.5

1 As at 31 December 2018 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 EUR 0.5 million.

As at 31 December 2017

		Carried at amortised cost		Carried at fair value	Total
In millions of euros	Fair value hierarchy	Carrying amount	Fair value	Carrying amount	Balance Sheet
As at 31 December 2017
Financial assets
Non-current financial assets:
Other financial assets		5.0	5.0	-	5.0
Trade and other receivables		317.8	317.8	-	317.8
Total non-current financial assets		322.8	322.8	-	322.8
Current financial assets:
Trade and other receivables		648.2	648.2	-	648.2
Derivatives	2	-	-	2.6	2.6
Cash and cash equivalents		269.6	269.6	-	269.6
Total current financial assets		917.8	917.8	2.6	920.4
Financial liabilities
Borrowings:
At floating rates:
Syndicated loan 20211	2	-	-	-	-
Commercial papers	2	-	-	-	-
COFACE	2	201.4	201.4	-	201.4
At fixed rates:
Eurobond 2018 (EUR 500 million)	2	498.4	506.7	-	498.4
US Bond 2019 (USD 500 million)	2	415.1	413.7	-	415.1
Eurobond 2020 (EUR 650 million)	2	648.3	712.9	-	648.3
Eurobond 2021 (EUR 650 million)	2	647.6	741.2	-	647.6
US Bond 2023 (USD 750 million)	2	623.5	627.7	-	623.5
US Bond 2043 (USD 250 million)	2	203.0	190.8	-	203.0
US Bond 2044 (USD 500 million)	2	406.3	377.0	-	406.3
German Bond 2032 (EUR 50 million), non-listed	2	49.8	59.0	-	49.8
Euro Private Placement 2027 (EUR 140 million) issued under EMTN	2	139.5	167.9	-	139.5
Fixed Term Loan Facility (LuxGovSat)	2	115.0	135.7	-	115.0
Total borrowings		3,947.9	4,134.0	-	3,947.9
Non-current financial liabilities:		3,543.3	3,720.3	-	3,543.3
Non-current borrowings		3,413.8	3,590.8	-	3,413.8
Fixed assets suppliers		53.4	53.4	-	53.4
Other long term liabilities		76.1	76.1	-	76.1
Current financial liabilities:		1,046.3	1,055.4	0.6	1,046.9
Current borrowings		534.1	543.2	-	534.1
Fixed assets suppliers		126.6	126.6		126.6
Derivatives	2	-	-	0.6	0.6
Trade and other payables		385.6	385.6	-	385.6

1 As at 31 December 2017 no amount had been drawn down under this facility. As a consequence, the remaining balance of loan origination cost of the Syndicated Loan was disclosed under prepaid expenses for an amount of EUR 1.8 million.

NOTE 19 - 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-dominated 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 Group also enters into derivative transactions, principally forward currency contracts, in order to manage exchange rate exposure on the Group's assets, liabilities and financial 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.

The Group's accounting policies in relation to derivatives and other financial instruments are set out in Note 2.

Liquidity risk

The Group's objective is to efficiently use cash generated so as to maintain borrowings at a low 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 additional 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, among others, the liquidity of the Group in order to optimise the funding costs. This is supported by a daily cash pooling mechanism.

Liquidity is monitored on a daily basis through a review of cash balances, the drawn and issued amounts and the availability of additional funding under committed credit lines, the two commercial paper programmes and the EMTN Programme (EUR 4,760.0 million as at 31 December 2018 and EUR 4,770.0 million as at 31 December 2017 - more details in Note 24).

The table below summarises the projected contractual undiscounted cash flows (nominal amount plus interest charges) based on the maturity profile of the Group's interestbearing borrowings as at 31 December 2018 and 2017.

In millions of euros	Within 1 year	Between 1 and 5 years	After 5 years	Total
As at 31 December 2018:
Borrowings	477.9	2,126.4	1,810.7	4,415.0
Future interest commitments	151.8	413.0	778.8	1,343.6
Trade and other payables	367.5	-	-	367.5
Other long-term liabilities	-	133.9	-	133.9
Lease liabilities	10.2	25.7	5.4	41.3
Fixed assets suppliers	130.8	200.9	-	331.7
Total maturity profile	1,138.2	2,899.9	2,594.9	6,633.0
As at 31 December 2017:
Borrowings	541.2	1,913.1	1,522.9	3,977.2
Future interest commitments	151.3	439.4	450.1	1,040.8
Trade and other payables	385.6	-	-	385.6
Other long-term liabilities	-	76.1	-	76.1
Fixed assets suppliers	126.6	53.4	-	180.0
Total maturity profile	1,204.7	2,482.0	1,973.0	5,659.7

Foreign currency risk

SES operates in markets outside of the euro zone, with procurement and sales facilities in various 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, by policy, does not use derivative financial instruments for speculative purposes.

The Group has significant foreign operations whose functional currency is not the euro. The primary currency exposure in terms of foreign operations is the US dollar and the Group has designated certain US dollar-denominated debt as net investment hedges of these operations. The Group also has a corresponding exposure in the consolidated income statement. 48.7% (2017: 49.5%) of the Group's sales and 64.9% (2017: 59.5%) of the Group's operating expenses are denominated in US dollars. The Group does not enter into any hedging derivatives to cover these currency exposures.

The Group uses predominantly forward currency contracts to eliminate or reduce the currency exposure arising from individual capital expenditure projects, such as satellite procurements, tailoring the maturities to each milestone payment. Depending on the functional currency of the entity with the capital expenditure commitment, the foreign currency risk might be in euro or in the US dollar. 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 commitment is in place, and to match the terms of the hedge derivatives to those of the hedged item to maximise effectiveness.

1) Cash flow hedges in relation to contracted commitments for capital expenditure

At 31 December 2018, the Group held no outstanding forward exchange contracts designated as hedges relating to satellite procurements (2017: asset of EUR 0.2 million) and no forward exchange contracts designated as hedges to cover the exposure between USD and BRL (2017: asset of EUR 0.4 million).

2) Hedge of net investment in foreign operations

As at 31 December 2018 and 2017, certain borrowings denominated in US dollars were designated as hedges of the net investments in SES Americas, SES Holdings (Netherlands) BV, SES Satellite Leasing Limited, MX1 Ltd, Israel and O3b Networks to hedge the Group's exposure to foreign exchange risk on these investments. As at 31 December 2018, all designated net investment hedges were assessed to be highly effective and a total loss of EUR 57.9 million net of tax of EUR 21.1 million (2017: gain of EUR 169.4 million net of tax of EUR 65.4 million) is included in equity accounts.

The following table demonstrates the hedged portion of USD statement of financial position exposure as at 31 December:

In millions of USD	2018	2017
USD statement of financial position exposure:
SES Americas	2,369.7	2,706.6
SES Holdings (Netherlands) BV	1,535.7	1,835.3
SES Satellite Leasing	1,130.4	1,395.9
MX1 Ltd, Israel	162.3	244.5
SES Networks Lux Sarl	1,701.6
O3b Networks	684.1	2,461.1
Total	7,583.8	8,643.4
Hedged with:
US Bonds	2,000.0	2,000.0
Other external borrowings	-	-
Total	2,000.0	2,000.0
Hedged proportion	26%	23%

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 account with no impact on profit and loss.

31 December 2018	Amount in USD million	Amount in EUR million at closing rate of 1.1450	Amount in EUR million at rate of 1.3700	Amount in EUR million at rate of 0.9200
USD statement of financial position exposure:
SES Americas	2,369.7	2,069.6	1,729.7	2,575.8
SES Holdings (Netherlands) BV	1,535.7	1,341.2	1,120.9	1,669.2
SES Satellite Leasing Limited	1,130.4	987.2	825.1	1,228.7
MX1 Ltd, Israel	162.3	141.7	118.5	176.4
SES Networks Lux Sarl	1,701.6	1,486.1	1,242.0	1,849.6
O3b Networks	684.1	597.5	499.3	743.6
Total	7,583.8	6,623.3	5,535.5	8,243.3
Hedged with:
US Bonds	2,000.0	1,746.7	1,459.9	2,173.9
Other external borrowings	-	-	-	-
Total	2,000.0	1,746.7	1,459.9	2,173.9
Hedged proportion	26%
Absolute difference without hedging			(1,087.8)	1,620.0
Absolute difference with hedging			(801.0)	1,192.8

31 December 2017	Amount in USD million	Amount in EUR million at closing rate of 1.1993	Amount in EUR million at rate of 1.4392	Amount in EUR million at rate of 0.9594
USD statement of financial position exposure:
SES Americas	2,706.6	2,256.8	1,880.7	2,821.0
SES Holdings (Netherlands) BV	1,835.3	1,530.3	1,275.2	1,912.9
SES Satellite Leasing Limited	1,395.9	1,163.9	969.9	1,454.9
MX1 Ltd, Israel	244.5	203.9	169.9	254.9
O3b Networks	2,461.1	2,052.1	1,710.1	2,565.2
Total	8,643.4	7,207.0	6,005.8	9,008.9
Hedged with:
US Bonds	2,000.0	1,667.6	1,389.7	2,084.5
Other external borrowings	-	-	-	-
Total	2,000.0	1,667.6	1,389.7	2,084.5
Hedged proportion	23%
Absolute difference without hedging			(1,201.2)	1,801.9
Absolute difference with hedging			(923.3)	1,385.0

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 EUR and USD. As per 31 December 2018, the Group had no interest rate hedges outstanding (2017: EUR 566.8 million interest rate hedges outstanding).

The table below summarises the split of the nominal amount of the Group's debt between fixed and floating rate.

In millions of euros	At fixed rates	At floating rates	Total
Borrowings at 31 December 2018	4,074.7	310.2	4,384.9
Borrowings at 31 December 2017	3,746.5	201.4	3,947.9

In the course of 2018 the Group repaid a maturing EUR 500.0 million senior bond and a total amount of EUR 41.2 million related to various Coface instalments.

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 variables are held constant.

The Group believes that a reasonably possible development in the euro zone interest rates would be an increase of 25 basis points or a decrease of nil basis points (2017: increase of 25 basis points or a decrease of nil basis points).

Euro interest rates

In millions of euros	Floating rate borrowings	Increase in rates Pre-tax impact	Decrease in rates Pre-tax impact
Borrowings at 31 December 2018	310.2	(0.8)	0.0
Borrowings at 31 December 2017	201.4	(0.5)	0.0

Credit risk

Risk management

The Group has two types of financial assets that are subject to the expected credit loss model: trade receivables and contract assets.

While cash and cash equivalents are also subject to the impairment requirements of IFRS 9, there was no impairment loss identified as at 31 December 2018.

It is the Group's policy that all customers who wish to trade on credit terms are subject to credit verification procedures. To measure the expected credit losses, trade receivables and contract assets have been grouped based on shared credit risk characteristics and the days past due. The contract assets relate to unbilled accrued revenue and 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 contract assets.

The credit verification procedures in relation to the assets above include the assessment of the creditworthiness 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 traded customers), 'Market' (usually higher growth companies with higher leverage) or 'Sub-prime' (customers for which viability is dependent on continued growth with higher leverage). The credit profile is updated at least once a year for all customers with an ongoing contractual relationship with annual revenues over EUR/USD 1 million or the equivalent in any other currency.

Impairment of trade receivables and assets related to contracts from customers

General provisions

The Group applies the IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected provisions for trade receivables and assets related to contracts from customers. To measure the expected credit losses, trade receivables and contract assets have been grouped in portfolios based on shared credit risk characteristics (credit risk profile: Prime, Market and Sub-prime, and country) and the days past due.

In order to compute the general bad debt provision, the gross trade receivables balance is reduced for any portion representing deferred revenue, any securities and any applicable credit limit provided by credit insurance.

Trade receivables are written off when there is no reasonable expectation of recovery. The Group's largest customers are substantial media companies and government agencies and hence the credit risk associated with these contracts is assessed as low.

On that basis, the provisions as at 31 December 2018 and 1 January 2018 (on adoption of IFRS 9) was determined as follows:

In millions of euros	Current	Less than 1 month	Between 1 and 3 months	More than 3 months	Total
31 December 2018
Average expected loss rate (by portfolio)	2.8%	3.2%	5.1%	7.2%
Gross carrying amount – trade receivables	248.5	58.0	63.4	139.6	509.5
Provision	0.3	0.2	1.0	2.4	3.8

Provision	0.4	0.9	2.3	3.7	7.3
Gross carrying amount – trade receivables	283.5	45.7	36.6	128.8	494.6
Average expected loss rate (by portfolio)	2.8%	3.2%	5.1%	7.2%
1 January 2018
In millions of euros	Current	Less than 1 month	Between 1 and 3 months	More than 3 months	Total

A specific provision for trade debtors of EUR 62.6 million has been recorded as at 31 December 2018 (31 December 2017: EUR 65.1 million).

The provision in respect of unbilled accrued revenue as at 31 December 2018 amounts to EUR 25.3 million and the corresponding expected credit loss is 6.1% (31 December

2017: EUR 22.0 million and the corresponding expected credit losses is 4.9%).

The closing provisions for trade receivables and unbilled accrued revenue as at 31 December 2018 reconcile to the opening loss allowances as follows:

	Provisions for trade receivables		Provisions for unbilled accrued revenue
In millions of euros	2018	2017	2018	2017
31 December - calculated under IAS 39	49.8	42.0	22.0	15.7
Amounts restated through opening retained earnings	7.3	-	(0.9)	-
Opening provision as at 1 January 2018 - calculated under IFRS 9	57.1	-	21.1	-
Increase in provision recognised in profit or loss during the year	38.5	19.1	7.1	13.3
Receivables written off during the year as uncollectible	(14.5)	(2.6)	-	(1.0)
Unused amount reversed	(16.6)	-	(4.0)	(7.3)
Impact of currency translation	1.9	(8.7)	1.1	1.3
At 31 December	66.4	49.8	25.3	22.0

Specific provisions

Additional provisions are recorded for trade receivables balances if specific circumstances led Management to believe that a specific collectability risk exists in respect of a customer. The following percentages are used as guidance, based on Management's judgement for trade receivables balances which are more than 90 days overdue and specific risks are identified:

• prime: 50% of the trade receivables balance;
• market: 70% of the trade receivables balance;
• sub-prime: 100% of the trade receivables balance;

Previous accounting policies for impairment of trade receivables

In the prior year, trade receivables which were more than 90 days overdue were provided for at 100% of the gross amount, except for those receivables due from a credit-worthy government or agency thereof, which are generally not provided for unless conditions warrant. In addition, receivable balances were monitored on an ongoing basis with the result that the Group's exposure to bad debts was historically insignificant.

Impairment of other assets

While cash and cash equivalents are also subject to the impairment requirements of IFRS 9, there was no identified impairment loss as of 31 December 2018 and 2017.

Financial credit risk

With respect to the credit risk relating to financial assets (cash and cash equivalents, held-for-trading financial assets, loans receivable and derivative instruments), 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 recognised financial institutions with an appropriate credit rating - generally '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 federal 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, a stable BBBrating with Standard & Poor's and a stable Baa2 rating with Moody's. This investment grade rating serves to maintain investors, creditors, rating agency 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 20 - CASH AND CASH EQUIVALENTS

In millions of euros	2018	2017
Cash at bank and in hand	542.2	227.7
Short-term deposits	366.9	41.9
Total cash and cash equivalents	909.1	269.6

Cash at banks earns 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. Shortterm deposits and cash at bank and in hand are held at various financial institutions meeting the credit rating criteria set out in Note 19 above.

As at 31 December 2018, an amount of EUR 15.4 million (2017: EUR 4.4 million) is invested in Money Market Funds which qualify as cash and cash equivalents and is included in shortterm deposits.

NOTE 21 - SHAREHOLDERS' EQUITY

Issued capital

SES has a subscribed capital of EUR 719.0 million (2017: EUR 719.0 million), represented by 383,457,600 class A shares (2017: 383,457,600 class A shares) and 191,728,800 class B shares (2017: 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:

	Class A shares	Class B shares	Total shares
As at 1 January 2018	383,457,600	191,728,800	575,186,400
Shares issued during the year	-	-	-
As at 31 December 2018	383,457,600	191,728,800	575,186,400
	Class A shares	Class B shares	Total shares
As at 1 January 2017	383,457,600	191,728,800	575,186,400
Shares issued during the year	-	-	-
As at 31 December 2017	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.

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%, 33% or 50% 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%, 33% or 50% 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.

Buy-back of treasury shares

SES has historically, in agreement with the shareholders, purchased FDRs in respect of 'Class A' shares in connection with executives' and employees' share-based payments plans as well as for cancellation. 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 balance sheet and are carried at acquisition cost as a deduction of equity.

	2018	2017
FDRs held as at 31 December	5,589,589	6,535,320
Carrying value of FDRs held (in millions of euros)	132.1	160.0

EUR 750,000,000 Deeply Subordinated Fixed Rate Resettable Securities

On 10 June 2016 SES issued EUR 750,000,000 Deeply Subordinated Fixed Rate Resettable Securities (the 'EUR 750.0 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 EUR 19.8 million and have been deducted from 'Other reserves'. SES is entitled to call the EUR 750.0 million perpetual bond on 2 January 2022 and on subsequent coupon payment dates.

EUR 550,000,000 Deeply Subordinated Fixed Rate Resettable Securities

On 29 November 2016 SES issued a second perpetual bond of EUR 550,000,000 (the 'EUR 550.0 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. Transaction costs related to this transaction amounted to EUR 7.6 million and have been deducted from 'Other reserves'. This brought the aggregate perpetual bond issued by the Group to EUR 1,300 million. SES is entitled to call the EUR 550 million perpetual bond on 29 January 2024 and on subsequent 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 EUR 1,281.9 million net of transaction costs and tax) as equity. The perpetual bonds are guaranteed 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.

Coupon payments in respect of the two perpetual bonds occurred on 2 January 2018 (EUR 34.7 million) and 29 January 2018 (EUR 30.9 million) and have been deducted from 'Other reserves'. The corresponding payments in 2017 were on 2 January 2017 (EUR 19.5 million) and 31 January 2017 (EUR 5.2 million) and were also deducted from 'Other reserves'.

Tax on the perpetual bond coupon accrual of EUR 18.8 million (2017: EUR 19.5 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 nondistributable. This requirement is satisfied when the reserve reaches 10% of the issued share capital. As at 31 December 2018 a legal reserve of EUR 70.0 million (2017: EUR 70.0 million) is included within other reserves.

Other reserves include a non-distributable amount of EUR 93.4 million (2017: EUR 85.1 million) linked to treasury shares, and an amount of EUR 229.4 million (2017: EUR 243.7 million) representing the net worth tax reserve for 2013-2018, 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 requirements.

NOTE 22 - 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.

In millions of euros		LuxGovSat S.A. (50% NCI)2	Ciel Satellite Limited Partnership, Canada (30% NCI)		Al Maisan Satellite Communications (YahSat) LLC, UAE (65% NCI)1
Summarised balance sheet	2018	2017	2018	2017	2018	2017
Current assets	31.3	42.2	3.6	4.5	22.6	27.1
Current liabilities	(5.8)	(15.5)	(4.9)	(17.9)	(5.5)	(5.6)
Current net assets	25.5	26.7	(1.3)	(13.4)	17.1	21.5
Non-current assets	208.1	182.6	49.0	103.0	51.4	55.7
Non-current liabilities	(116.3)	(116.1)	-	(2.4)	-	-
Non-current net assets	91.8	66.5	49.0	100.6	51.4	55.7
Net assets	117.3	93.2	47.7	87.2	68.5	77.2
Accumulated NCI	58.6	46.6	14.2	26.2	44.5	50.2
Transactions with non-controlling interests	-	-	(14.2)	-	-	-

1 The Group, as of 31 December 2018 and 31 December 2017, has majority of the voting rights on the Board of Directors of the Company, i.e. 3 members out of 5 or 60% (Note 2)

2 Please refer to Note 2 for more details

In millions of euros		LuxGovSat S.A. (50% NCI)	Ciel Satellite Limited Partnership, Canada (30% NCI)		Al Maisan Satellite Communications (YahSat) LLC, UAE (65% NCI)
Summarised statement of comprehensive income	2018	2017	2018	2017	2018	2017
Revenue	22.2	4.2	39.3	42.3	16.4	22.0
Operating expenses	(12.8)	(5.6)	(2.3)	(2.5)	(22.1)	(20.5)
Profit/(loss) for the period	24.2	(2.8)	(23.2)	21.4	(18.3)	(5.6)
Other comprehensive income	-	-	-	-	-	-
Total comprehensive income	24.2	(2.8)	(23.2)	21.4	(18.3)	(5.6)
Profit/(loss) allocated to NCI	12.1	(1.4)	(7.0)	6.4	(11.9)	(3.6)
Dividend paid to NCI	-	-	6.2	7.2	-	-

In millions of euros		LuxGovSat S.A. (50% NCI)	Ciel Satellite Limited Partnership, Canada (30% NCI)		Al Maisan Satellite Communications (YahSat) LLC, UAE (65% NCI)
Summarised cash flows	2018	2017	2018	2017	2018	2017
Cash flows from/(absorbed by) operating activities	8.6	(3.8)	23.4	23.5	(1.4)	-
Cash flows from/(absorbed by) investing activities	(17.6)	(42.9)	(0.7)	(0.4)	(0.0)	1.0
Cash flows from/(absorbed by) financing activities	10.4	(0.3)	(20.8)	(24.2)	0.2	1.9
Net foreign exchange movements	-	(0.2)	-	1.3	0.4	(0.6)
Net increase/(decrease) in cash and cash equivalents	1.4	(47.2)	1.9	0.2	(0.8)	2.3

Transactions with non-controlling interests

In 2018 SES put in place an agreement with the minority partner holding 30% interest in Ciel Satellite Limited Partnership, according to which SES will distribute to the minority partner a fixed amount per month over a five-year period. Thus, the variable stream that the minority partner was previously receiving based on Ciel Satellite Limited Partnership's business developments, has been replaced with a fixed stream.

As the minority partner is no longer subject to variable returns and has no interest in the residual assets of Ciel Satellite Limited Partnership, the non-controlling interest amounting to EUR 14.2 million as at 31 December 2018 has been fully reversed. An amount of EUR 6.6 million, representing the fair value of the liability towards the minority partner has been reclassified to 'Other long-term liabilities' (EUR 4.8 million) and to 'Trade and other payables' (EUR 1.8 million), and the remainder of EUR 7.6 million has been reversed against 'Other reserves'.

NOTE 23 - SHARE-BASED COMPENSATION PLANS

The Group has four share-based compensation plans which are detailed below. In the case of plans 1 and 3 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 nonexecutive staff of Group subsidiaries, where share options are granted. In January 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.

	2018	2017
Outstanding options at the end of the year	2,154,927	2,306,003
Weighted average exercise price in euro	25.01	25.02

Out of 2,154,927 outstanding options as at 31 December 2018 (2017: 2,306,003), 2,154,927 options are exercisable (2017: 2,092,730). Options exercised in 2018 resulted in 11,914 treasury shares (2017: 15,675) being delivered at a weighted average price of EUR 17.83 each (2017: EUR 17.90).

On average, the related weighted average share price at the time of exercise was EUR 19.63 (2017: EUR 21.48) per share.

Movements in the number of share options outstanding and their related weighted average exercise prices in euro are as follows:

	2018 Average exercise price per share option	Number of options	2017 Average exercise price per share option	Number of options
As at 1 January	25.02	2,306,003	25.04	2,447,556
Forfeited	25.71	(139,162)	26.35	(125,878)
Exercised	17.83	(11,914)	17.90	(15,675)
At 31 December	25.01	2,154,927	25.02	2,306,003

Share options outstanding at the end of the year have the following expiry date and exercise prices in euro:

Grant	Expiry date	Exercise price per share options (modified plan)	Exercise price per share options (original plan)	Number of options
				2018	2017
2016	2023	24.39	24.76	603,910	647,556
2015	2022	32.73	33.23	390,881	419,006
2014	2021	26.50	26.91	412,864	441,287
2013	2020	23.51	23.87	366,033	391,473
2012	2019	18.10	18.38	256,154	270,243
2011	2019	17.57	17.84	125,085	136,438
				2,154,927	2,306,003

All options, except the ones granted in 2016, are fully vested.

2) Simulated Restricted Stock Units (SRSU)

In June 2017, the Group entered into a new compensation plan, which will progressively replace the STAR Plan. Simulated Restricted Stock Units (SRSU) are cash-settled awards which will be delivered on 1 June following a three year vesting period and are settled in cash. 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 appreciation rights by applying a binomial model, 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 2018, 415,761 SRSUs have been granted (2017: 281,800). On the same period, 56,658 SRSUs have

been forfeited (2017: 10,848) and 2,840 SRSUs have been vested (2017: 1,087). An accrual amounting to EUR 3,558,351 has been recognised in the consolidated income statement as 'staff costs' as at 31 December 2018 (31 December 2017: EUR 682,683) based on the 626,128 outstanding SRSUs (31 December 2017: 269,865) 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 Incentive Compensation Plan ('EICP')

The EICP is available to Group executives. Under the plan, options are granted with an effective date of 1 or 6 of January. One-quarter or one fifth of the entitlement vests on each anniversary date of the original grant. Once vested, the options can be exercised until the tenth anniversary of the original grant.

	2018	2017
Outstanding options at the end of the year	14,311,080	9,727,470
Weighted average exercise price in euro	19.22	23.62

Out of 14,311,080 outstanding options as at 31 December 2018 (2017: 9,727,470), 7,871,276 options are exercisable (2017: 5,496,176). Options exercised in 2018 resulted in 143,150 Treasury shares (2017: 44,897) being delivered at a weighted average price of EUR 13.31 each (2017: 16.52).

On average, the related weighted average share price at the time of exercise was EUR 15.97 (2017: EUR 22.10) per share.

Movements in the number of share options outstanding and their related weighted average exercise prices in euro are as follows:

	2018 Average exercise price per share option	Number of options	2017 Average exercise price per share option	Number of options
At 1 January	23.62	9,727,470	25.01	6,503,084
Granted	12.67	5,796,083	21.15	3,531,419
Forfeited	24.54	(1,069,323)	26.25	(262,136)
Exercised	13.31	(143,150)	16.52	(44,897)
At 31 December	19.22	14,311,080	23.62	9,727,470

Share options outstanding at the end of the year have the following expiry date and exercise prices in euro:

Grant	Expiry date	Exercise price per share options (modified plan)	Exercise price per share options (original plan)	Number of options
				2018	2017
2018	2028	12.67	-	5,686,736	-
2017	2027	21.15	-	3,136,922	3,520,224
2016	2026	24.39	24.76	2,384,490	2,726,576
2015	2025	32.73	33.23	986,269	1,140,693
2014	2024	26.50	26.91	791,159	925,254
2013	2023	23.51	23.87	408,105	430,720
2012	2022	18.10	18.38	371,738	385,012
2011	2021	17.57	17.84	259,311	265,430
2010	2020	17.96	18.23	124,943	136,684
2009	2019	13.47	13.68	104,792	115,514
2008	2019	14.40	14.62	38,341	63,089
2007 non-US	2019	14.32	15.17	5,584	5,584
2007 US	2019	15.56	15.17	12,690	12,690
				14,311,080	9,727,470

4) Long-term Incentive programme ('LTI')

The LTI Plan is also a programme for executives, and senior executives, of the Group. 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.

	2018	2017
Restricted and performance shares outstanding at the end of the year	1,578,505	1,099,660
Weighted average fair value in euro	14.02	19.32

During 2018, 203,890 restricted shares and 594,645 performance shares have been granted. On the same period, 23,113 restricted shares and 58,410 performance shares have forfeited, 163,350 performance shares and 74,817 restricted shares have been 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 EICP and a Black & Scholes model for LTI, taking into account the terms and conditions upon which the options (restricted and performance shares) were granted. The following table lists the average value of inputs to the model used for the years ended 31 December 2018, and 31 December 2017.

2018	EICP	LTI
Dividend yield (%)	7.89%, 7.99%	7.89%
Expected volatility (%)	27.37%	31.73%
Risk-free interest rate (%)	-0.06%, -0.43%	-0.43%
Expected life of options (years)	10	3
Share price at inception (EUR)	13.33	13.33
Fair value per option/share (EUR)	1.31-1.58	10.53
Total expected cost for each plan (in millions of euros)	7.23	7.04
2017	EICP	LTI
Dividend yield (%)	8.97%	7.95%
Expected volatility (%)	21.14%	23.21%
Risk-free interest rate (%)	-0.30%	-0.61%
Expected life of options (years)	9.65	3
Share price at inception (EUR)	21.06	21.06
Fair value per option/share (EUR)	0.95-1.31	16.56
Total expected cost for each plan (in millions of euros)	3.7	7.1

The expected life of 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 volatility is indicative of future trends, which may or may not necessarily be the actual outcome.

The total charge for the period for share-based compensation amounted to EUR 14.7 million (2017: EUR 10.5 million).

NOTE 24 - INTEREST-BEARING BORROWINGS

As at 31 December 2018 and 2017, the Group's interest-bearing borrowings were:

In millions of euros	Effective interest rate	Maturity	Amounts outstanding 2018, carried at amortised cost
Non-current
Eurobond 2020 (EUR 650 million)	4.625%	March 2020	649.1
Eurobond 2021 (EUR 650 million)	4.75%	March 2021	648.4
COFACE	EURIBOR 6M + 1.70%	Various 2020-2022	119.6
US Bond (USD 750 million)	3.60%	April 2023	653.4
German bond (EUR 150 million), non-listed	EURIBOR 6M + 0.80%	June 2024	149.4
German bond (EUR 250 million), non-listed	1.71%	December 2025	249.0
Eurobond 2026 (EUR 500 million)	1.625%	March 2026	494.1
Euro Private Placement 2027 (EUR 140 million issued under EMTN)	4.00%	May 2027	139.6
Fixed Term Loan (LuxGovSat)	3.30%	December 2027	115.0
German bond (EUR 50 million), non-listed	4.00%	November 2032	49.8
US Bond (USD 250 million)	5.30%	April 2043	213.6
US Bond (USD 500 million)	5.30%	March 2044	427.5
Total non-current			3,908.5
Current
COFACE	EURIBOR 6M + 1.70%	Various in 2019	41.2
US Bond (USD 500 million)	2.50%	March 2019	435.2
Total current			476.4

In millions of euros	Effective interest rate	Maturity	Amounts outstanding 2017, carried at amortised cost
Non-current
US Bond (USD 500 million)	2.50%	March 2019	416.5
Eurobond 2020 (EUR 650 million)	4.625%	March 2020	649.1
Eurobond 2021 (EUR 650 million)	4.75%	March 2021	648.4
COFACE	EURIBOR 6M + 1.70%	Various from 2019 to 2022	161.6
US Bond (USD 750 million)	3.60%	April 2023	623.9
Euro Private Placement 2027 (EUR 140 million issued under EMTN)	4.00%	May 2027	139.6
Fixed Term Loan (LuxGovSat)	3.30%	December 2027	115.0
German bond (EUR 50 million), non-listed	4.00%	November 2032	49.8
US Bond (USD 250 million)	5.30%	April 2043	203.2
US Bond (USD 500 million)	5.30%	March 2044	406.7
Total non-current			3,413.8

Current
COFACE	EURIBOR 6M + 1.70%	Various in 2018	40.3
Eurobond 2018 (EUR 500 million)1	1.875%	October 2018	498.4
Loan origination cost			(4.6)
Total current			534.1

1 The loan origination cost related to the borrowings have been reclassified to short term for the portion that will be amortised in 2018.

European Medium-Term Note Programme ('EMTN')

On 6 December 2005, SES put in place a EUR 2,000.0 million EMTN enabling SES, or SES Global Americas Holdings GP, to issue as and when required notes up to a maximum aggregate amount of EUR 2,000.0 million. In May 2007, this programme was increased to an aggregate amount of EUR 4,000.0 million. On 12 March 2018 this programme has been extended for one further year. As at December 31, 2018, SES had issued EUR 1,940.0 million (2017: EUR 1,940.0 million) under the EMTN Programme with maturities ranging from 2020 to 2027.

EUR 500.0 million Eurobond (2018)

On 16 October 2013, SES issued a EUR 500.0 million bond under the Company's European Medium-Term Note Programme. The bond had a 5-year maturity and bears interest at a fixed rate of 1.875%. The bond was paid on 24 October 2018.

144A Bond USD 500 million (2019)

On 25 March 2014, SES completed a 144A offering in the US market issuing USD 500 million 5-year bond with a coupon of 2.50% and a final maturity date of 25 March 2019.

EUR 650.0 million Eurobond (2020)

On 9 March 2010, SES issued a EUR 650.0 million bond under the Company's European Medium-Term Note Programme. The bond has a 10-year maturity and bears interest at a fixed rate of 4.625%.

EUR 650.0 million Eurobond (2021)

On 11 March 2011, SES issued a EUR 650.0 million bond under the Company's European Medium-Term Note Programme. The bond has a 10-year maturity and bears interest at a fixed rate of 4.75%.

German bond issue of EUR 400.0 million (2024 / 2025)

On 5 December 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.

EUR 500.0 million Eurobond (2026)

On 22 March 2018, SES issued a EUR 500.0 million 8-year bond under the Company's European Medium-Term Note Programme. The bond bears interest at a fixed rate of 1.625% and has a final maturity date on 22 March 2026.

EUR 140.0 million Private Placement (2027)

Between May and July 2012, SES issued three individual tranches of a total EUR 140.0 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%.

German bond issue of EUR 50.0 million (2032)

On 29 October 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 750.0 million (2023)

On 4 April 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.

144A Bond USD 250.0 million (2043)

On 4 April 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 500.0 million (2044)

On 25 March 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.

Syndicated loan 2021

In January 2014, the Group updated its previous syndicated loan facility ('Syndicated loan 2015'). The updated facility is being provided by 20 banks and has been structured as a 5-year multicurrency revolving credit facility with two one-year extension options at the discretion of the lenders. The facility is for EUR 1,200 million and the interest payable is linked to a ratings grid. At the current SES rating of BBB / Baa2, the interest rate is 45 basis points over EURIBOR/ LIBOR. On 13 November 2015 and 23 November 2015 respectively, the facility agreement has been amended and extended by one year to 13 January 2021. As at 31 December 2018 and 2017, no amount had been drawn under this facility.

EUR 522.9 million COFACE facility

On 16 December 2009, SES signed a financing agreement with COFACE (Compagnie Française d'Assurance pour le Commerce Extérieur) 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 repayable in 17 equal semi-annual instalments where Coface A has a final maturity date of 1 August 2022, Coface F will mature 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 sixmonth EURIBOR plus a margin of 1.7%. In November 2017, SES opted to execute voluntary prepayment 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.

EUR 115.0 million Credit Facility (LuxGovSat)

In July 2015, LuxGovSat S.A. signed a financing agreement with BGL BNP Paribas over a EUR 115 million fixed rate portion at 3.30%. The facility is repayable in 14 semi-annual installments and has a final maturity date of 1 December 2027. The first drawing was done on 1 May 2016 and as of 31 December 2018 and 2017, total borrowings of EUR 115.0 million were outstanding under the fixed term facility. The same financing agreement also included a EUR 10 million floating rate credit facility which was never drawn and finally expired on 30 November 2017.

Negotiable European Commercial Paper "NEU CP" (previous French Commercial paper programme)

On 25 October 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 18 May 2018, this programme was extended for one further year. As at 31 December 2018 and 2017, no borrowings were outstanding under this programme.

European Commercial paper programme

In July 2012, SES signed the documentation for the inception of a joint EUR 1,000 million guaranteed European commercial paper programme of SES S.A. and SES Global Americas Holdings GP. The issuance under the programme represents senior unsecured obligations of the issuer and any issuance under the programme is 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 4 July 2017, this programme was updated and extended. As at 31 December 2018 and 2017, no borrowings were outstanding under this programme.

NOTE 25 - PROVISIONS

In millions of euros	2018	2017
Non-current	16.8	41.2
Current	48.6	12.7
Total	65.4	53.9

Movements in each class of provision during the financial year are set out below:

In millions of euros	Group tax provision	Other provisions	Total
As at 1 January 2018	40.1	13.8	53.9
Additional provisions recognised	24.3	2.7	27.0
Unused amounts reversed	(1.1)	-	(1.1)
Used during the year	(6.0)	(8.9)	(14.9)
Impact of currency translation	0.2	0.3	0.5
As at 31 December 2018	57.5	7.9	65.4
Non-current	13.7	3.1	16.8
Current	43.8	4.8	48.6
In millions of euros	Group tax provision	Other provisions	Total
As at 1 January 2017	105.6	25.8	131.4
Additional provisions recognised	16.1	5.6	21.7
Unused amounts reversed	(68.1)	(3.5)	(71.6)
Used during the year	(6.2)	(12.9)	(19.1)

Group tax provision

The recognition of an additional Group tax provision is mainly due to the refunds of withholding tax in India following the favourable High Court hearings in 2017. A corresponding provision was booked pending a final decision at the Supreme Court level. EUR 8.8 million of additional provision recognised did not impact profit and loss account.

Other provisions

On the acquisition of O3b, a liability to its employees amounting to EUR 15.9 million has been recognised in respect of outstanding share-based payment awards as at acquisition date. An amount of EUR 3.2 million (2017: EUR 5.8 million) has been paid to O3b employees during the year. As at 31 December 2018 the remaining liability is EUR 3.4 million (2017: EUR 6.6 million).

Other provisions of EUR 4.5 million used during the year relate to costs associated with litigation procedures.

NOTE 26 - TRADE AND OTHER PAYABLES

In millions of euros	2018	2017
Trade creditors	113.7	139.7
Payments received in advance (please also see Note 27)	1.2	24.6
Interest on borrowings	77.4	72.9
Personnel-related liabilities	53.4	44.3
Tax liabilities other than for income tax	65.3	53.9
Other liabilities	56.5	50.2
Total	367.5	385.6

Tax liabilities mainly relate to VAT payables in the amount of EUR 61.3 million as of 31 December 2018 (2017: EUR 51.9 million).

NOTE 27 - OTHER LONG-TERM LIABILITIES

In millions of euros	2018	2017
Employee benefits obligations	24.3	23.6
Payments received in advance	96.7	46.3
Other long-term liabilities	12.9	6.2
Total	133.9	76.1

Employee benefits obligations

In US operations, certain employees benefit from a postretirement health benefits programme which is externally insured. As at 31 December 2018, accrued premiums of EUR 14.8 million (2017: EUR 14.0 million) are included in this position.

Contributions made in 2018 to Group pension schemes totalled EUR 1.1 million (2017: EUR 1.2 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 EUR 10.0 million has been recognised as at 31 December 2018 (2017: EUR 9.8 million) in this respect.

Payments received in advance

In the framework of receivables securitisation transactions completed in June 2010, June 2012, June 2013, June 2017, and June 2018 the Group received a net cash amount of EUR 50.6 million, EUR 59.5 million, EUR 40.2 million, EUR 61.0 million, and EUR 88.3 million, respectively, from a financial institution as advance settlement of future receivables arising between 2011 and 2022 under contracts with a specific customer. A corresponding liability of EUR 97.9 million (2017: EUR 70.0 million), 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 Statement of Financial Position as at 31 December 2018 under 'Other long-term liabilities' for EUR 96.7 million (2017: EUR 46.3 million and under 'Trade and other payables' for EUR 23.7 million).

Transactions with non-controlling interests

An amount of EUR 6.6 million, representing the fair value of the liability towards the minority partner of Ciel Satellite Limited Partnership has been presented under 'Other long-term liabilities' (EUR 4.8 million) and 'Trade and other payables' (EUR 1.8 million) (see Note 22).

NOTE 28 - FIXED ASSETS SUPPLIERS

In millions of euros	2018	2017
Non-current	200.9	53.4
Current	130.8	126.6

Fixed assets suppliers represent liabilities for assets being either acquired directly through procurement contracts with asset manufacturers, or in the framework of agreements whereby the asset is being acquired by an intermediary but 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 29.

Non-current fixed assets suppliers include an amount of EUR 16.9 million (2017: EUR 14.1 million) related to performance incentives for O3b's fully operational satellites. Based on the contract with Thales, there was a total increase during the year of EUR 9.1 million. In December 2018 the Company renegotiated the terms of the contract, resulting in a release to the consolidated income statement of EUR 6.3 million.

Acquisition of SES mPOWER medium-Earth orbit constellation

On 11 September 2017, the Company, jointly with its subsidiary 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.

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.

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. 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. 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 construction 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.

As at 31 December 2018 an amount of EUR 174.1 million (USD 199.4 million) has been accrued in connection with the constructive obligation for mPOWER programme costs described above.

Non-current fixed assets suppliers were initially recognised at fair value and subsequently measured at amortised cost using the effective interest method.

NOTE 29 - COMMITMENTS AND CONTINGENCIES

Capital commitments

The Group had outstanding commitments in respect of contracted capital expenditure totalling EUR 997.5 million at 31 December 2018 (2017: EUR 1,136.1 million). These

commitments largely reflect the procurement of satellites and satellite launchers and are stated net of liabilities under these programmes which are already disclosed under within "Fixed assets suppliers", see Note 28.

The capital commitment arising under these agreements as at 31 December is as follows:

In millions of euros	2018	2017
Within one year	471.7	129.1
After one year but not more than five years	460.6	909.1
After more than five years	65.2	97.9
Total	997.5	1,136.1

Commitments under transponder service agreements

The Group has entered into transponder service agreements for the purchase of satellite capacity from third parties

under contracts with a maximum life of eight years. The commitment arising under these agreements as at 31 December is as follows:

In millions of euros	2018	2017
Within one year	69.2	56.6
After one year but not more than five years	84.5	43.8
After more than five years	15.0	6.4
Total	168.7	106.8

Total expense for transponder service agreements was EUR 92.3 million in 2018 (2017: EUR 102.9 million).

Litigation

There were no significant litigation claims against the Group as at 31 December 2018.

Guarantees

On 31 December 2018 the Group had outstanding bank guarantees for an amount of EUR 118.5 million (2017: EUR 130.2 million) with respect to performance and warranty guarantees for services of satellite operations.

NOTE 30 - LEASES

1) Lessor

During 2018 the Group recognised leasing income of EUR 76.8 million (2017: EUR 80.3 million) related to two lease contracts. One of the lease contracts matures on 27 January 2019 and the related lease payment will amount to EUR 2.0 million. The other lease contract matures on 30 November 2021 and the related annual lease payment will amount to EUR 20.3 million in 2019 and 2020, and EUR 18.6 million in 2021. The related carrying amount of property, plant and equipment leased as at 31 December 2018 amounts to EUR 178.8 million.

2) Lessee

The impact of the first-time adoption of IFRS 16 "Leases" is disclosed in Note 3.

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.

In millions of euros	Buildings	Ground segment	Other fixtures and fittings, tools and equipment	31 December 2018
Right-of-use assets
Cost	37.3	8.2	2.1	47.6
Accumulated depreciation	(6.5)	(2.5)	(0.9)	(9.9)
Total	30.8	5.7	1.2	37.7

There were no material additions to the right-of-use assets during 2018, depreciation charge for the year was EUR 9.7 million.

Lease liabilities are presented below as at 31 December:

In millions of euros	2018
Maturity analysis – contractual undiscounted cash flows
Within one year	10.2
After one year but not more than five years	25.7
More than five years	5.3
Total	41.2
Lease liabilities included in the statement of financial position at 31 December
Current	9.5
Non-current	28.6
Total	38.1

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 of time after the end of the contract term. The Group assesses at lease commencement whether it is reasonable 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 circumstances within its control.

ii) Amounts recognised in the consolidated income statement

Depreciation charge of right-of-use assets:

In millions of euros	2018
Buildings	6.4
Ground segment	2.4
Other fixtures and fittings, tools and equipment	0.9
Total	9.7

Finance cost:

In millions of euros	2018
Interest expense	0.7
Total	0.7

The total cash outflow for leases in 2018 was EUR 9.5 million.

NOTE 31 - CASH FLOW INFORMATION

Non-cash investing activities

Purchases of property, plant and equipment not included as a cash outflow in the consolidated statement of cash flows are disclosed in Notes 13 and 14.

Net debt reconciliation

This section sets out an analysis of net debt and the movements in net debt for 2018 and 2017.

In millions of euros	2018	2017
Cash and cash equivalents	909.1	269.6
Borrowings – repayable within one year	(476.4)	(534.1)
Borrowings – repayable after one year	(3,908.5)	(3,413.8)
Net debt	(3,475.8)	(3,678.3)

In millions of euros	2018	2017
Cash and cash equivalents	909.1	269.6
Borrowings – floating rates	(310.2)	(201.4)
Borrowings – fixed interest rates	(4,074.7)	(3,746.5)
Net debt	(3,475.8)	(3,678.3)

In millions of euros	Cash and cash equivalents	Borrowings - repayable within one year	Borrowings - repayable after one year	Total
Net debt as at 31 December 2017	269.6	(534.1)	(3,413.8)	(3,678.3)
Cash flows (net)	640.3	541.7	(893.0)	289.0
Foreign exchange adjustments	(0.8)	(30.9)	(48.2)	(79.9)
Transfers	-	(447.0)	447.0	-
Other non-cash movements1	-	(6.1)	(0.5)	(6.6)
Net debt as at 31 December 2018	909.1	(476.4)	(3,908.5)	(3,475.8)

In millions of euros	Cash and cash equivalents	Borrowings - repayable within one year	Borrowings - repayable after one year	Total
Net debt as at 31 December 2016	587.5	(204.3)	(4,223.1)	(3,839.9)
Cash flows (net)	(301.7)	100.0	153.0	(48.7)
Foreign exchange adjustments	(16.2)	-	234.8	218.6
Transfers	-	(436.7)	436.7	-
Other non-cash movements1	-	6.9	(15.2)	(8.3)
Net debt as at 31 December 2017	269.6	(534.1)	(3,413.8)	(3,678.3)

1 related to loan origination costs

During 2018 the Group issued European Commercial Paper for EUR 100.0 million (2017: EUR 500.0 million) and reimbursed EUR 100.0 million (2017: EUR 600.0 million). These have been presented net in the consolidated statement of cash flows.

NOTE 32 - RELATED PARTIES

The state of Luxembourg holds a direct 11.58% voting interest in the Company and two indirect interests, both of 10.88%, 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 21.

The total payments to directors for attendance at board and committee meetings in 2018 amounted to EUR 1.3 million (2017: EUR 1.4 million). These payments are computed on a fixed and variable basis, the variable part being based upon attendance at board and committee meetings.

The key management of the Group, defined as the Group's Executive Committee, received compensation as follows:

In millions of euros	2018	2017
Remuneration including bonuses	3.9	5.3
Pension benefits	0.5	0.8
Share-based compensation plans	1.0	1.7
Other benefits	0.9	0.6
Total	6.3	8.4

The remuneration for the existing Executive Committee is complemented by EUR 4.4 million total gross remuneration paid to the two departing Executive Committee members.

The total outstanding amount in respect of share-based payment instruments allocated to key management as at 31 December 2018 were 3,714,589 (2017: 2,932,673).

NOTE 33 - POST-BALANCE SHEET EVENTS

There were no other material events occurring between the reporting date and the date when the consolidated financial statements were authorised by the Board of Directors.

NOTE 34 - CONSOLIDATED SUBSIDIARIES, ASSOCIATES

The consolidated financial statements include the financial statements of the Group's subsidiaries and associates listed below:

	Economic interest (%) 2018	Economic interest (%) 2017	Method of consolidation 2018	Method of consolidation 2017
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.A., Luxembourg	100	100	Full	Full
SES Latin America S.A., Luxembourg	100	100	Full	Full
SES Belgium S.p.r.l, Belgium	100	100	Full	Full
SES Insurance International S.A., Luxembourg	100	100	Full	Full
SES Insurance International Re S.A., Luxembourg	100	100	Full	Full
SES Lux Finance S.à r.l., Luxembourg2	100	100	Full	Full
SES Networks Lux S.à r.l., Luxembourg3	100	100	Full	Full
Ciel Satellite Holdings Inc., Canada	100	100	Full	Full
Ciel Satellite Limited Partnership, Canada	100	70	Full	Full
Northern Americas Satellite Ventures, Inc., Canada	100	100	Full	Full
SES TechCom S.A., Luxembourg	100	100	Full	Full
SES-15 S.à r.l., Luxembourg	100	100	Full	Full
SES Digital Distribution Services AG, Switzerland2	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 ASTRA Real Estate (Betzdorf) S.A., Luxembourg	100	100	Full	Full
MX1 GmbH, Germany	100	100	Full	Full
SES Media Solutions GmbH, Germany	100	100	Full	Full
MX1 (Thailand) Ltd, Thailand	100	100	Full	Full
PT MX1 Smartcast Indonesia, Indonesia	100	100	Full	Full
MX1 Asia Limited, China2	-	100	Full	Full
ASTRA Deutschland GmbH, Germany	100	100	Full	Full
SES ASTRA Iberica S.A., Spain	100	100	Full	Full
ASTRA France S.A., France	100	100	Full	Full
ASTRA (GB) Limited, United Kingdom	100	100	Full	Full
SES ASTRA CEE Sp. z o.o, Poland	100	100	Full	Full
SES ASTRA (Romania) S.r.l., Romania	100	100	Full	Full
SES Satellites Ghana Ltd, Ghana	100	100	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 Ukraine, Ukraine	100	100	Full	Full
SES ASTRA 1KR S.à r.l., Luxembourg	100	100	Full	Full
SES ASTRA 1L S.à r.l., Luxembourg	100	100	Full	Full
SES ASTRA 1M S.à r.l., Luxembourg	100	100	Full	Full
SES ASTRA 3B S.à r.l., Luxembourg	100	100	Full	Full
SES ASTRA 5B S.à r.l., Luxembourg	100	100	Full	Full
SES ASTRA 1N S.à r.l., Luxembourg	100	100	Full	Full

	Economic interest (%) 2018	Economic interest (%) 2017	Method of consolidation 2018	Method of consolidation 2017
SES ASTRA 2E S.à r.l., Luxembourg	100	100	Full	Full
SES ASTRA 2F S.à r.l., Luxembourg	100	100	Full	Full
SES ASTRA 2G S.à r.l., Luxembourg	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	100	100	Full	Full
Al Maisan Satellite Communications (YahSat) LLC, UAE	35	35	Full	Full
Satellites Ventures (Bermuda), Ltd, Bermuda	50	50	Full	Full
SES ASTRA Africa (Proprietary) Ltd, South Africa	100	100	Full	Full
SES AMERICOM, Inc., U.S.A.	100	100	Full	Full
SES Telecomunicacoes 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 Telecomunicaciones de Mexico S. de R.L. de C.V., Mexico	100	100	Full	Full
SES Satellites International, Inc., U.S.A.	100	100	Full	Full
SES Satellites (Gibraltar) Ltd, Gibraltar	100	100	Full	Full
AMC-1 Holdings LLC, U.S.A.	100	100	Full	Full
AMC-2 Holdings LLC, U.S.A.	100	100	Full	Full
AMC-3 Holdings LLC, U.S.A.	100	100	Full	Full
SES-9 Holdings LLC, U.S.A.	100	100	Full	Full
AMC-6 Holdings LLC, U.S.A.	100	100	Full	Full
AMC-8 Holdings LLC, U.S.A.	100	100	Full	Full
AMC-9 Holdings LLC, U.S.A.	100	100	Full	Full
AMC-10 Holdings LLC, U.S.A.	100	100	Full	Full
AMC-11 Holdings LLC, U.S.A.	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
AMC-12 Holdings LLC, U.S.A.	100	100	Full	Full
AMC-4 Holdings LLC, U.S.A.	100	100	Full	Full
AMC-7 Holdings LLC, U.S.A.	100	100	Full	Full
AMC-15 Holdings LLC, U.S.A.	100	100	Full	Full
AMC-16 Holdings LLC, U.S.A.	100	100	Full	Full
SES-1 Holdings, 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
AOS Inc., U.S.A.	100	100	Full	Full
SES-2 Holdings LLC, U.S.A.	100	100	Full	Full
SES-3 Holdings LLC, U.S.A.	100	100	Full	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 Global South America Holding S.L., Spain	100	100	Full	Full
New Skies Satellites B.V., The Netherlands	100	100	Full	Full
New Skies Satellites, Inc., 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
New Skies Networks, Inc., U.S.A.2	-	100	Full	Full
SES ENGINEERING (Netherlands) B.V., The Netherlands	100	100	Full	Full

	Economic interest (%) 2018	Economic interest (%) 2017	Method of consolidation 2018	Method of consolidation 2017
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.A., Luxembourg	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 Ltd, Jersey, Channel Islands	100	100	Full	Full
O3b Ltd, Jersey, Channel Islands	100	100	Full	Full
O3b Africa Ltd, Mauritius	100	100	Full	Full
O3b Networks Management Services B.V., The Netherlands	100	100	Full	Full
O3b Sales B.V., The Netherlands	100	100	Full	Full
O3b Holdings 1 B.V., The Netherlands	100	100	Full	Full
O3b Holdings 2 B.V., The Netherlands	100	100	Full	Full
O3b Coöperatief UA, The Netherlands	100	100	Full	Full
O3b Networks USA, LLC, U.S.A.	100	100	Full	Full
O3b USA, LLC, U.S.A.	100	100	Full	Full
O3b America, LLC, U.S.A.	100	100	Full	Full
O3b (Singapore) Pte Limited, Singapore	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., Luxembourg4	100	100	Full	Full
SES Networks Satellites S.à r.l., Luxembourg5	100	100	Full	Full
West Africa Platform Services Ltd, Ghana	51	51	Full	Full
MX1 Ltd, Israel	100	100	Full	Full
MX1 Inc., U.S.A.	100	100	Full	Full
Satlink Communications Ltd, Israel2	-	100	Full	Full
G.S.N GoSat Distribution Network Ltd, Cyprus	100	100	Full	Full
EMP Media Port Ltd, Cyprus	100	100	Full	Full
MX1 C.E.E. S.A., Romania	80	80	Full	Full
MX1 Limited, United Kingdom	100	100	Full	Full
World Satellite Distribution S.A., Luxembourg	100	100	Full	Full
Sofia Teleport EOOD, Bulgaria2	100	100	Full	Full
TVP Group Ltd, United Kingdom2	-	100	Full	Full
MX1 Korea Ltd., Korea	51	51	Full	Full
London Broadcasting Center Ltd., United Kingdom	100	100	Full	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-11 Holdings, LLC, U.S.A.	100	100	Full	Full
SES Networks GmbH, Germany1	100	-	Full	-

1 Entity created or acquired in 2018

2 Entity sold, merged, liquidated or in the process of liquidation in 2018

3 Formerly SES NL Finance S.à r.l.

4 Formerly O3b Lux S.à r.l.

5 Formerly O3bNext S.à r.l.

150

CONTENTS

Audit report	153
Balance sheet	156
Profit and loss account	158
Statement of changes in shareholders' equity	159
Notes to the annual accounts	160
Note 1 - General Information	160
Note 2 - Summary of significant accounting policies and valuation rules	160
Note 3 - Financial assets	162
Note 4 - Debtors	166
Note 5 - Investments - own shares	166
Note 6 - Subscribed capital and share premium account	167
Note 7 - Legal reserve	167
Note 8 - Reserve for own shares	167
Note 9 - Other reserves, including the fair value reserve	167
Note 10 - Creditors	168
Note 11 - Other creditors - tax authorities	172
Note 12 - Other creditors - payable after more than one year	172
Note 13 - Other operating income	173
Note 14 - Staff costs	173
Note 15 - Income from participating interests	173
Note 16 - Income from other investments and loans	173
Note 17 - Other interest receivable and similar income	173
Note 18 - Value adjustments in respect of financial assets
and investments held as current assets	174
Note 19 - Interest payable and similar expenses	174
Note 20 - Audit fees	174
Note 21 - Board of Directors' remuneration	175
Note 22 - Off balance sheet commitments	175
Note 23 - Subsequent events	175

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 2018, 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 2018;
• the profit and loss account for the year then ended; and
• the notes to the annual accounts, 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 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 International Ethics Standards Board for Accountants' Code of Ethics for Professional 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 Regulation (EU) 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 20 to the annual accounts.

Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the annual accounts of the current period, and include the most significant assessed risks of material misstatement (whether or not due to fraud).

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 of 8,056.4 million EUR.

Management's assessment of the recoverable amount of investments in shares in affiliated undertakings requires significant judgement in the determination of the level at which these investments are tested for impairment taking into account the substance of their business activity, the interdependency of their cash flows and their level of integration.

Moreover, the determination of the recoverable value of these investments requires significant estimates as it relates to the determination of the forecasted cash flows, the discount rates and the long-term growth rates.

We focused on this area due to the inherent complexity and judgement in the estimates for the recoverable amount of the investments in affiliated undertakings and the materiality of the balance.

How our audit addressed the Key audit matter

• We obtained an understanding of Management's process and controls related to the identification of the impairment indicators and the impairment test of the investments in affiliated undertakings;
• We evaluated Management's methodology used to estimate the recoverable amount of the investments in affiliated undertakings, including the grouping of certain investments in order to appropriately reflect the substance of their activity, interdependency of their cash flows and the level of integration of their operations;
• We agreed the forecasted cash flows used for the determination of the recoverable value to the 2019 Business Plan as approved by the Board of Directors and challenged the different assumptions based on our expectations in terms of significant developments during the forecast period and evaluated whether these were appropriately reflected in the cash flows;
• We involved valuation specialists and independently recalculated the weighted average cost of capital based on the use of market data and challenged the long-term growth rate applied;

• 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 annual report including the management 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 information 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 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 information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of the Board of Directors 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 preparation 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.

Responsibilities of the "Réviseur d'entreprises 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 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 conducted 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. 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 professional 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 evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company'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 independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

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.

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) 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 annual accounts and has been prepared in accordance with applicable legal requirements.

We have been appointed as "Réviseur d'Entreprises Agréé" of the Company by the General Meeting of the Shareholders on 5 April 2018 and the duration of our uninterrupted engagement, including previous renewals and reappointments, is 6 years.

Other matter

The Corporate Governance Statement includes, when applicable, the information required by Article 68ter Paragraph (1) Letters a), b), e), f) and g) 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.

PricewaterhouseCoopers, Société coopérative Luxembourg, 26 February 2019

Represented by Gilles Vanderweyen

BALANCE SHEET

As at 31 December 2018

In millions of euros	Note	2018	2017
Assets
Fixed Assets
Intangible assets		1.6	0.7
Financial assets
Shares in affiliated undertakings	3	8,056.4	8,034.9
Loans to affiliated undertakings	3	2,275.6	1,994.8
		10,333.6	10,030.4
Current Assets
Debtors
Amounts owed by affiliated undertakings
becoming due and payable within one year	4	2,323.0	2,014.1
becoming due and payable after one year	4	174.1	-
Other debtors
becoming due and payable within one year		4.3	4.6
Investments
Own shares	5	93.4	85.0
Cash at bank and cash in hand		825.2	172.7
		3,420.0	2,276.4
Prepayments
becoming due and payable within one year		10.7	14.5
becoming due and payable after one year		38.1	38.1
Total assets		13,802.4	12,359.4

BALANCE SHEET

As at 31 December 2018

In millions of euros	Note	2018	2017
Liabilities
Capital and reserves
Subscribed capital	6	719.0	719.0
Share premium account	6	1,890.2	1,890.2
Reserves
Legal reserve	7	70.0	70.0
Reserve for own shares	8	93.4	85.0
Other reserves, including the fair value reserve
Profit brought forward		1,284.7	1,680.5
Profit for the financial year		1,172.3	(19.8)
		5,229.6	4,424.9
Creditors
Debenture loans - Non convertible loans	10
becoming due and payable within one year		576.3	634.1
becoming due and payable after more than one year		5,000.0	4,457.7
Amounts owed to credit institutions	10
becoming due and payable within one year		42.0	41.9
becoming due and payable after more than one year		122.1	163.6
Trade creditors
becoming due and payable within one year		0.7	1.7
Amounts owed to affiliated undertakings	10
becoming due and payable within one year		2,569.8	2,079.2
becoming due and payable after more than one year		68.0	532.6
Other creditors
Tax authorities	11	11.5	19.6
Social security authorities		0.3	0.3
Other creditors
becoming due and payable within one year		8.0	3.8
payable after more than one year	12	174.1	-
		8,572.8	7,934.5
Total liabilities		13,802.4	12,359.4

PROFIT AND LOSS ACCOUNT

For the year ended 31 December 2018

In millions of euros	Note	2018	2017
Profit and loss account
Other operating income	13	16.8	15.2
Raw material and consumables and other external expenses
Other external expenses		(25.4)	(31.6)
Staff costs	14
Wages and salaries		(18.7)	(11.4)
Social security costs
relating to pensions		(1.1)	(1.2)
other social security costs		(0.4)	(0.1)
Other staff costs		(0.1)	(0.2)
Other operating expenses		(8.5)	(3.1)
Income from participating interest
concerning affiliated undertakings	15	1,354.7	255.2
Income from other investments and loans forming part of fixed assets
concerning affiliated undertakings	16	25.9	59.8
Other interest receivable and similar income
other interest and similar income	17	55.4	2.8
Value adjustment in respect of financial assets and of investments	18	5.7	(136.0)
held as current assets
Interest payable and similar expenses
concerning affiliated undertakings	19	(35.2)	(34.7)
other interest and similar expenses	19	(254.6)	(237.0)
Tax on profit or loss		59.3	104.5
Taxes other		(1.5)	(2.0)
		1,172.3	(19.8)

STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY

As at 31 December 2018

In millions of euros	Subscribed capital	Share premium	Legal reserve	Other reserves1	Result for the year	Total
At 1 January 2017	719.0	1,890.2	64.4	2,276.2	111.5	5,061.3
Allocation of result	-	-	5.6	105.9	(111.5)	-
Distribution of dividends	-	-	-	(616.6)	-	(616.6)
Other movements	-	-	-	-	-	-
Loss for the financial year	-	-	-	-	(19.8)	(19.8)
At 31 December 2017	719.0	1,890.2	70.0	1,765.5	(19.8)	4,424.9
At 1 January 2018	719.0	1,890.2	70.0	1,765,5	(19.8)	4,424.9
Allocation of result	-	-	-	(19.8)	19.8	-
Distribution of dividends	-	-	-	(367.6)	-	(367.6)
Other movements	-	-	-	-	-	-
Profit for the financial year	-	-	-	-	1,172.3	1,172.3
At 31 December 2018	719.0	1,890.2	70.0	1,378.1	1,172.3	5,229.6

1 Including reserves for own shares, other non available reserves and profit brought forward.

NOTES TO THE ANNUAL ACCOUNTS

As at 31 December 2018

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 whatsoever 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 communication 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.

In 2013 the Company established a branch in Switzerland in order to centralise the cash pooling mechanism in place for the Company and its subsidiaries ('the SES Group'). The annual accounts of the branch are also integrated into those of the Company.

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 Luxembourg law.

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 applicable 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 Luxembourg 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 critical accounting estimates. It also requires the Board of Directors to exercise its judgment in the process of applying the accounting policies. 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 appropriate and that the annual accounts therefore present the financial position 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 reevaluated, and are based on historical experience and

other factors, including expectations of future events that are believed to be reasonable under the circumstances.

2.2. Significant accounting policies

The main accounting policies and valuation rules applied by the Company are the following:

2.2.1. 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 taken into account in assessing the carrying value of the financial assets.

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.

2.2.2. 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 on the basis of 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.

2.2.3. Prepayments

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.

2.2.4. 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.

2.2.5. Profit Participating Convertible Certificates

Profit Participating Convertible Certificates ('PPC Certificates') were securities issued by SES's subsidiary SES Finance S.à r.l. ('the Issuer') and subscribed by the Company, representing a claim of principal amount and profit participating interest ('PPI') on that principal amount. The PPI amounts were payable at maturity date, unless the Issuer elected to convert the principal amount of the PPC Certificates into shares.

The PPI on the PPC Certificates was calculated based on the cumulative profits of the Issuer over the term of the agreement. The Company's entitlement to a return, in the form of PPI, therefore only crystallised at the date of maturity, or at the time of an election by the Issuer to convert its PPC Certificate obligation into equity if earlier. In November 2018, the Issuer elected to convert the

principal amount into shares and issued new share capital in December 2018 to effect this resolution. The election to convert the PPL obligation into shares resulted in the extinguishment of the Issuers obligation to settle the accrued PPI on the PPC Certificates. See also Note 3 (b).

2.2.6. Debtors

Debtors are recorded at their nominal value. They are subject to value adjustments where their recovery is uncertain. These value adjustments 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). Transactions expressed in currencies other than the euro are translated into euros at the exchange rates effective at the time of the transaction.

With the exception of 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 are translated into euro at the exchange rate effective at the time of the transaction. At the balance sheet date, these assets remain translated at historical exchange rates.

The foreign exchange result for the year has been presented on a net basis.

2.2.8. Derivative financial instruments

The Company may enter into contracts for derivative instruments, for example forward currency contracts, in order to manage the exchange rate exposure on the Company's, and SES Group's, assets, liabilities and financial operations.

Such financial instruments are used to reduce the SES Group's exposure to risks in connection with operating liabilities denominated in US dollars, such as milestone payments to satellite manufacturers. Such instruments are denominated in the same currency as the hedged item and can cover up to 100% of the total value of the hedged item. It is the Company's policy not to enter into such forward contracts until a firm commitment is in place, and to match the terms of hedge derivatives to those of the hedged item.

Additionally, the Company has significant debenture loans denominated in US dollars. The Company may enter into derivatives, such as forward currency contracts or crosscurrency swaps, in order to manage exchange rate exposure on foreign currency debt.

Financial derivatives are revalued at the year-end using forward rates. Both unrealised gains and losses resulting from the revaluation of these contracts are recognised in the profit and loss account under "other interest and similar income" or "other interest and similar expenses" respectively. SES does not use derivative financial instruments for speculative purposes.

Assets or liabilities generated by unrealised gains or losses are recognised and recorded under "amounts owed to/by affiliated undertakings" where the counterparty is a member of the SES Group.

2.2.9. 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.

2.2.10. 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:

• The Stock Appreciation Rights Plan ('STAR Plan')
• Simulated Restricted Stock Units plan ('SRSU Plan')
• Executive Incentive Compensation Plan ('EICP')
• Long-Term Incentive Programme ('LTIP')

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.

A charge corresponding to the number of SRSUs outstanding at the share price on 31 December 2018 is recognised in the profit and loss account on a pro-rata basis over the vesting 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

In millions of euros	2018	2017
Historic cost:
As at 1 January:	8,120.3	7,833.5
Increase1	40.8	286,8
As at 31 December	8,161.1	8,120.3
Accumulated value adjustments
As at 1 January	(85.4)	-
Increase2	(19.3)	(85.4)
As at 31 December	(104.7)	(85.4)
Net book value:
As at 1 January	8,034.9	7,833.5
As at 31 December	8,056.4	8,034.9

1 The increase of EUR 40.8 million in the net book value of SES Finance S.à r.l. represents the net impact of a non-cash share premium contribution from SES Finance S.à r.l. to the Company in December 2018 of EUR 850.8 million and a capital reduction of EUR 810.0 million.

2 The increase of million EUR 19.3 million represents a value adjustment recorded in connection with the investment in SES Networks Lux S.à r.l. (formerly SES NL Finance S.à r.l.) (2017: 85.4 million). This value adjustment was recorded at the time of the transfer of this shareholding to SES Holdings (Netherlands) B.V. in March 2018

As at 31 December 2018, the Company held the following investments:

In millions of euros
Net book value	Incorporation in:		2018	2017
SES Global – Americas, Inc.	United Sates	99.94%	3,477.6	3,477.6
SES Finance S.à r.l (formerly Switzerland)2	Luxembourg	100%	1,543.0	-
SES Holdings (Netherlands) B.V.1	Netherlands	100%	1,241.4	350.8
SES Astra S.A.	Luxembourg	100%	1,046.8	1,046.8
SES Participations S.A.	Luxembourg	100%	206.8	206.8
SES Insurance International Re (Luxembourg) S.A.	Luxembourg	100%	90.3	90.4
SES Astra A.B.	Sweden	32.34%	50.1	50.1
SES Insurance International (Luxembourg) S.A.	Luxembourg	100%	15.2	15.2
SES Finance S.à r.l2	Switzerland	100%	-	1,502.2
SES Astra Services Europe S.A.	Luxembourg	100%	366.6	366.6
SES Latin America S.A	Luxembourg	100%	18.6	18.6
SES Networks Lux S.à r.l. (formerly SES NL Finance S.à r.l.)1	Luxembourg	100%	-	909.8
SES Belgium S.p.r.l	Belgium	99%	-	-
Total			8,056.4	8,034.9

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.

2 SES Finance S.à r.l (Switzerland) was redomiciled to Luxembourg as of 1 December 2018.

Management identified the following CGUs for the purpose of impairment testing: SES GEO operations ('SES GEO'), SES MEO operations ('SES MEO'), MX1 and other, included under "Services".

The investment in SES Holdings (Netherlands) B.V., amounting to EUR 1,241.4 million, includes both SES GEO and SES MEO operations and was considered accordingly for impairment testing purposes.

Impairment testing for SES GEO operations

Affiliated undertakings part of the "SES GEO operations" business of the SES Group are aggregated into one CGU for the purpose of testing their carrying values for impairment, considering the interdependency of their cash flows and their level of integration (see Note 2). Loans to/from affiliated undertakings which are part of SES GEO have also been added to the carrying values of the affiliated undertakings.

The value-in-use of this CGU is determined based on a value-in-use calculation using the most recent business plan information approved by the Board of Directors which covers a period of five years. This period reflects the longterm contractual base for the satellite business. The pre-tax discount rate used was 8.40% (2017: 8.10%) and was selected to reflect market interest rates and commercial spreads; the capital structure of businesses in the SES Group's business sector, and the specific risk profile of the businesses concerned. The terminal growth rate used in the valuation was 2.0% (2017: 2.0%), which reflects the most recent longterm planning assumptions approved by the Board, and can

be supported by reference to the trading performance of the companies concerned over a longer period.

An impairment test performed on each investment taken individually (the "line-by-line method"), would potentially lead to a different conclusion, in particular, for the investment held by the Company in SES Global-Americas. Inc. However, for the reasons stated above and as described in Note 2.2.1., the Board of Directors of the Company does not believe that the "line-by-line method" is appropriate considering the integrated nature of the SES GEO operations business and the interdependency of its cash flows.

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 currently generates cash inflows that are independent from SES GEO operations.

For the 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 expenditure and expected growth of the business in connection with the O3b mPOWER constellation, which is expected to launch in 2021, as well as to properly reflect the timing of replacement capital expenditure.

The pre-tax discount rate applied for 2018 was 10.21% (2017: 10.37%) and was 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 rate used in the valuations was 2.0% (2017: 2.0%), which reflects the most recent long-term planning assumptions approved by the Board of Directors and can be supported by reference to the trading performance of the companies concerned over a longer period.

Affiliated undertakings representing services companies of the SES Group are tested for impairment individually unless their carrying value is insignificant.

Based on this impairment testing, the Board of Directors believes that no value adjustment should be recorded on the carrying values of the shares in affiliated undertakings except for a charge of EUR 19.3 million (2017: EUR 85.4 million) in connection with the investment in 'Services' company SES Networks Lux S.à r.l. (formerly SES NL Finance S.à r.l. until 28.03.2018).

Art. 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 disclosure 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.

b) Loans to affiliated undertakings

Loans to affiliated undertakings as of 31 December 2018 consist of:

Counterparty	Principal and accrued interest 31 December 2018 (EUR million)	Maturity	Interest rate
SES Americom Inc.	259.5	June-22	2.93%
SES-15 S.à r.l	173.4	January-33	1.55%
SES Astra 5B S.à r.l.	178.6	June-29	1.11%
SES Astra 2G S.à r.l.	132.0	June-30	1.19%
SES Astra 2F S.à r.l.	106.7	November-27	0.95%
SES Astra 3B S.à r.l.	84.0	June-25	0.67%
SES-10 S.à r.l.	80.0	January-32	2.29%
SES Astra 2E S.à r.l.	25.0	February-29	1.06%
SES Astra 1N S.à r.l.	25.4	November-26	0.80%
SES Finance Services A.G.	8.8	March-25	0.80%
SES Finance Services A.G.	8.8	March-25	0.80%
SES Finance Services A.G.	5.5	March-25	0.80%
New Skies Satellites B.V.	182.3	November-23	4.16%
New Skies Satellites B.V.	334.5	November-23	4.16%
New Skies Satellites B.V.	4.9	December-24	4.16%
New Skies Satellites B.V.	231.2	December-32	4.16%
SES Holdings (Netherlands) B.V.	164.8	October-24	4.16%
SES Holdings (Netherlands) B.V.	88.4	December-24	4.16%
SES Holdings (Netherlands) B.V.	35.4	December-24	4.16%
SES Media Solutions GmbH	140.0	November-21	0.41%
SES DTH do Brasil Ltda	1.2	May-23	2.76%
SES DTH do Brasil Ltda	0.6	May-23	4.38%
SES DTH do Brasil Ltda	0.5	May-22	4.10%
SES DTH do Brasil Ltda	1.2	June-22	3.97%
SES DTH do Brasil Ltda	1.2	September-22	4.23%
SES DTH do Brasil Ltda	0.6	June-23	5.01%
SES DTH do Brasil Ltda	0.6	August-23	5.32%
SES DTH do Brasil Ltda	0.5	November-23	5.48%
Total	2,275.6

Loans to affiliated undertakings as of 31 December 2017 consist of:

Counterparty	Principal and accrued interest 31 December 2017 (EUR million)	Maturity	Interest rate
SES Finance S.à r.l.	673.2	December-22	Profit participating convertible certificates, no interest
SES Finance S.à r.l.	140.0	December-18	Profit participating convertible certificates, no interest
SES Americom Inc.	247.7	June-22	2.93%
SES-15 S.à r.l	186.7	January-33	1.55%
SES Astra 5B S.à r.l.	196.4	June-29	1.11%
SES Astra 2G S.à r.l.	144.0	June-30	1.19%
SES Astra 2F S.à r.l.	120.1	November-27	0.95%
SES Astra 3B S.à r.l.	98.0	June-25	0.67%
SES-10 S.à r.l.	86.8	January-32	2.29%
SES Astra 2E S.à r.l.	27.5	February-29	1.06%
SES Astra 1N S.à r.l.	29.1	November-26	0.80%
SES Finance Services A.G.	8.5	March-25	0.80%
SES Finance Services A.G.	8.5	March-25	0.80%
SES Finance Services A.G.	5.2	March-25	0.80%
SES Asia S.A.	23.1	December-19	0.72%
Total	1,994.8

With effect from 1 December 2018, SES Finance S.à r.l. ('SES Finance') was redomiciled from Zurich in Switzerland to Betzdorf in Luxembourg. SES Finance is now registered as a 'Société à responsabilité limitée' at the Registre de Commerce et des Sociétés de Luxembourg. The two Profit Participating Convertible Certificates issued by SES Finance to SES in February 2007, of USD 807.4 million and EUR 140.0 million respectively, were converted into SES Finance equity in December 2018 through the issuance of new shares.

In December 2018, SES Finance reduced its share premium by EUR 810.0 million through the assignment to SES of loans granted by SES Finance to SES Holdings (Netherlands) B.V. and SES Media Solutions GmbH and with a cash payment settled within the framework of the cash management agreement between the parties.

In December 2018, SES Finance also paid a dividend to SES of EUR 1,000.0 million. This dividend was settled through the assignment of loans granted by SES Finance to New Skies Satellites B.V. as well as a cash payment settled within the framework of the cash management agreement between the parties.

During the year, new loans of USD 7.4 million (EUR 6.4 million) have been granted to SES DTH do Brasil Ltda.

The Company does not consider any balances on its loans to affiliates as being irrecoverable as at 31 December 2018.

NOTE 4 - DEBTORS

Amounts owed by affiliated undertakings

The SES Group operates a centralised treasury function at the level of the Company which manages, among others, liquidity to optimise funding costs. This is supported by a daily cash pooling mechanism.

Amounts owed by affiliated undertakings of EUR 2,323.0 million (2017: EUR 2,014.1 million) consist of :

In millions of euros	2018	2017
Intercompany current accounts	1,460.8	1,162.5
Short term loan to O3b Networks Limited	709.2	786.8
Short term loan to Luxembourg satellite companies	83.3	20.4
Short term loan to SES Asia S.A.	23.1	-
Short term loan to SES Networks Lux S.à r.l. (formerly SES NL Finance S.à r.l.)	46.6	44.4
Total	2,323.0	2,014.1
Forward Sale Agreement with SES mPOWER S.à r.l.	174.1	-

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 does not consider their recoverability to be uncertain.

In 2018, SES entered into a forward sale agreement with SES mPOWER S.à r.l (see Note 12). As at 31 December 2018, SES had a receivable from SES mPOWER S.à r.l of USD 199.4 million (EUR 174.1 million) in the framework of this agreement.

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 executives 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 2018, the Company owned 5,589,589 FDRs (2017: 6,535,320) representing EUR 93.4 million (2017: EUR 85.0 million).

NOTE 6 - SUBSCRIBED CAPITAL AND SHARE PREMIUM ACCOUNT

SES has a subscribed capital of EUR 719.0 million (2017: EUR 719.0 million), represented by 383,457,600 Class A shares (2017: 383,457,600) and 191,728,800 Class B shares (2017: 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 the shares of Class B, which are held by the State of Luxembourg and by two entities 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:

As at 31 December 2017	383,457,600	191,728,800	575,186,400
Shares issued during the year	-	-	-
As at 1 January 2017	383,457,600	191,728,800	575,186,400
As at 31 December 2018	383,457,600	191,728,800	575,186,400
Shares issued during the year	-	-	-
As at 1 January 2018	383,457,600	191,728,800	575,186,400
	Class A shares	Class B shares	Total shares

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

NOTE 8 - RESERVE FOR OWN SHARES

In accordance with the law, the Company has created a nondistributable "reserve for own shares" for an amount of EUR 93.4 million (2017: EUR 85.0 million), corresponding to the balance of the own shares held as of year end.

reaches 10% of the issued share capital. This reserve may not be distributed.

Acquisition of treasury shares

SES has historically, in agreement with its shareholders, purchased FDRs in connection with executives' and employees' share-based payments plans, as well as for cancellation.

NOTE 9 - OTHER RESERVES, INCLUDING THE FAIR VALUE RESERVE

Other non-distributable reserves

In 2017 the Company released its remaining Net Wealth Tax liability in the amount of EUR 61.8 million, representing the reserve for 2011, in accordance with Paragraph 8a of the Luxembourg Net Wealth Tax law. The Company had allocated under "Other non-distributable reserves" an amount that corresponded to five times the amount of reduction of the Net Wealth Tax.

In order to benefit from the Net Wealth Tax reduction, the Company had to maintain this reserve for a period of five

years. Were the reserve to have been distributed before the end of this five year period, then Net Wealth Tax would have become due for an amount of up to 20% of the distributed amount.

Since 2012 the Net Wealth Tax reserve is recorded at the level of SES ASTRA S.A. This entity forms part of the tax unity.

NOTE 10 - CREDITORS

a) Debenture loans - Non convertible loans

The maturity profile of notes and bonds is as follows as at 31 December 2018.

			2018
Creditors - Financial liabilities	Interest rate	Maturity	EUR million
a) Debenture loans - Non convertible loans			5,576.3
becoming due and payable within one year1			576.3
Non convertible bonds due >1 Y: Accrued interest			139.6
144A Bond USD 500.0 million (2019)	2.50%	March-19	436.7
becoming due and payable between 1 and 2 years			650.0
EUR 650 million Eurobond (2020)	4.625%	March-20	650.0
becoming due and payable between 3 and 5 years			650.0
EUR 650 million Eurobond (2021)	4.75%	March-21	650.0
becoming due and payable after 5 years			3,700.0
EUR 140.0 million Private Placement (2027)	4.00%	May-27	140.0
144A Bond USD 750.0 million (2023)	3.60%	April-23	655.0
144A Bond USD 250.0 million (2043)	5.30%	April-43	218.3
144A Bond USD 500.0 million (2044)	5.30%	March-44	436.7
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%	January-222	750.0
EUR 550 million deeply subordinated fixed rate resettable securities	5.625%	January-242	550.0
EUR 500 million Eurobond (2026)	1.625%	March-26	500.0
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

1 Includes accrued interest of EUR 139.6 million at year-end 2018 (2017: EUR 134.1 million).

2 Representing first reset date

The maturity profile of notes and bonds is as follows as at 31 December 2017.

			2017
Creditors - Financial liabilities	Interest rate	Maturity	EUR million
a) Debenture loans - Non convertible loans			5,091.8
becoming due and payable within one year3			634.1
Non convertible bonds due >1 Y: Accrued interest			134.1
EUR 500.0 million Eurobond (2018)	1.875%	October-18	500.0
becoming due and payable between 1 and 2 years			416.9
144A Bond USD 500.0 million (2019)	2.50%	March-19	416.9
becoming due and payable between 3 and 5 years			1,300.0
EUR 650 million Eurobond (2020)	4.625%	March-20	650.0
EUR 650 million Eurobond (2021)	4.75%	March-21	650.0
becoming due and payable after 5 years			2,740.8
EUR 140.0 million Private Placement (2027)	4.00%	May-27	140.0
144A Bond USD 750.0 million (2023)	3.60%	April-23	625.4
144A Bond USD 250.0 million (2043)	5.30%	April-43	208.5
144A Bond USD 500.0 million (2044)	5.30%	March-44	416.9
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%	January-224	750.0
EUR 550 million deeply subordinated fixed rate resettable securities	5.625%	January-244	550.0

3 Includes accrued interest of EUR 134.1 million at year-end 2017 (2016: EUR 95.4 million).

4 Representing first reset date

European Medium-Term Note Programme ('EMTN')

On 6 December 2005, SES put in place a EUR 2,000.0 million EMTN enabling SES, or SES Global Americas Holdings GP, to issue, as and when required, notes up to a maximum aggregate amount of EUR 2,000.0 million. In May 2007, this programme was increased to an aggregate amount of EUR 4,000.0 million. On 12 March 2018 this programme has been extended for one further year.

As at December 31, 2018, SES had issued EUR 1,940.0 million (2017: EUR 1,940.0 million) under the EMTN Programme with maturities ranging from 2020 to 2027.

EUR 500.0 million Eurobond (2018)

In October 2013, SES issued a EUR 500.0 million bond under the Company's European Medium-Term Note Programme. The bond had a 5-year maturity and bears interest at a fixed rate of 1.875%. This Bond has been fully repaid in October 2018.

144A Bond USD 500.0 million (2019)

In March 2014, SES completed a 144A offering in the US market issuing USD 500.0 million 5-year bond with a coupon of 2.50% and a final maturity date of 25 March 2019.

EUR 650.0 million Eurobond (2020)

In March 2010, SES issued a EUR 650.0 million bond under the company's European Medium-Term Note Programme. The bond has a 10-year maturity and bears interest at a fixed rate of 4.625%.

EUR 650.0 million Eurobond (2021)

In March 2011, SES issued a EUR 650.0 million bond under the Company's European Medium-Term Note Programme. The bond has a 10-year maturity and bears interest at a fixed rate of 4.75%.

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 subsequent coupon payment dates.

144A Bond USD 750.0 million (2023)

On 4 April 2013, SES completed a 144A offering in the US market issuing a USD 750.0 million 10-year bond with a coupon of 3.60% and a final maturity date on 4 April 2023.

EUR 500.0 million Eurobond (2026)

On 22 March 2018, SES issued a EUR 500.0 million 8-year bond under the Company's European Medium-Term Note Programme. The bond bears interest at a fixed rate of 1.625% and has a final maturity date on 22 March 2026.

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 140.0 million Private Placement (2027)

Between May and July 2012, SES issued to ING Bank N.V. three individual tranches of a total EUR 140.0 million Private Placement under the company's European Medium-Term Note Programme. The Private Placement has a 15-year maturity, beginning 31 May 2012, and bears interest at a fixed rate of 4.00%.

German bond issue of EUR 50.0 million (2032)

In October 2012, the Company issued EUR 50.0 million in the German bond ('Schuldschein') market. The bond bears a fixed interest rate of 4.00% and matures on 12 November 2032.

144A Bond USD 250.0 million (2043)

In April 2013, SES completed a 144A offering in the US market issuing a USD 250.0 million 30-year bond with a coupon of 5.30% and a final maturity date on 4 April 2043.

144A Bond USD 500.0 million (2044)

In March 2014, SES completed a 144A offering in the US market issuing a USD 500.0 million 30-year bond with a coupon of 5.30% and a final maturity date of 25 March 2044.

German bond issue of EUR 400.0 million (2024/2025)

On 5 December 2018, the Company closed the issuance of an aggregated amount of EUR 400 million in the German bond ('Schuldschein') market.

The transaction consists of two tranches:

• a EUR 150 million tranche with a floating interest rate (six-month EURIBOR plus a 0.8% margin) maturing on 18 June 2024;
• a EUR 250 million tranche with a fixed interest rate of 1.71% maturing on 18 December 2025.

b) Amounts owed to credit institutions

Amounts owed to credit institutions as of 31 December 2018 were:

2018
EUR million	Maturity	Interest rate	Creditors - Financial liabilities
			b) amounts owed to credit institutions
42.0			becoming due and payable within one year
42.0	various from 2019	EURIBOR +1.70%	COFACE facility
122.1			becoming due and payable after more than one year
122.1	various from 2020 to 2022	EURIBOR +1.70%	COFACE facility

Amounts owed to credit institutions as of 31 December 2017 were:

		2017
Interest rate	Maturity	EUR million
		41.9
EURIBOR +1.70%	various from 2018	41.9
		163.6
EURIBOR +1.70%	various from 2019 to 2022	163.6

Syndicated loan (2021)

In January 2014, the Company updated its previous syndicated loan facility ('Syndicated loan 2015'). The updated facility is being provided by 20 banks and has been structured as a 5 year multicurrency revolving credit facility with two one-year extension options at the discretion of the lenders. The facility is for EUR 1,200.0 million and the interest payable is linked to a ratings grid. At the current SES rating of BBB / Baa2, the interest rate is 45 basis points over EURIBOR/LIBOR. On 13 November 2015 and 23 November 2015 respectively, the facility agreement was amended and extended by one year to 13 January 2021. As at 31 December 2018 and 2017, no amount has been drawn under this facility.

EUR 522.9 million COFACE facility

On 16 December 2009, SES signed a financing agreement with the 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 was divided into five loans. Drawings under the facility were based on invoices from the supplier of the satellites. The first draw-down was in April 2010 and all loan tranches became fully drawn in November 2014.

Each Coface tranche is repayable in 17 equal semi-annual instalments where Coface A has a final maturity date of 1 August 2022, Coface F will mature 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 prepayment 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.

European Commercial paper programme

In July 2012, SES established a joint EUR 1,000.0 million guaranteed European commercial paper programme of SES S.A. and SES Global Americas Holdings GP. Any issuances under the programme represent senior unsecured obligations of the issuer and are guaranteed by the nonissuing entity. The programme is rated by Moody's Investors Services and is compliant with the standards set out in the STEP Market Convention. On 4 July 2017, this programme was updated and extended. As at 31 December 2018 and 2017, no borrowings were outstanding under this programme.

Negotiable European Commercial Paper "NEU CP" (formerly French Commercial paper programme)

On 25 October 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 18 May 2018, this programme was extended for one further year. As at 31 December 2018 and 2017, no borrowings were outstanding under this programme.

The aggregate maturity profile of amounts drawn from credit institutions and becoming due and payable after more than one year is as follows as at 31 December 2018 and 2017:

In millions of euros 2018	2017
Between one and two years 82.4	82.0
Between two and five years 39.7	81.6
After five years -	-
Total 122.1	163.6

During the year 2018, SES repaid floating rate obligations totaling EUR 41.5 million (2017: EUR 54.2 million) related to various Coface instalments.

Committed and uncommitted loan facilities

As at 31 December 2017 and as at 31 December 2018, the Company had no outstanding balances under uncommitted loan facilities.

c) Amounts owed to affiliated undertakings

Amounts owed to affiliated undertakings of EUR 2,637.8 million (2017: EUR 2,611.8 million) include the following:

In millions of euros	2018	2017
Long-term loans (maturity after five years)	68.0	66.0
Term loans (between one and five years)	-	466.6
Current accounts	2,569.8	2,079.2
Total	2,637.8	2,611.8

As at 31 December 2018 long-term loans included:

• A loan for a total amount of USD 51.2 million from SES Satellites Gibraltar Ltd. with a maturity date of May 2025 and bearing interest at a rate of 4.2%;
• A loan for a total amount of EUR 23.3 million from SES ASTRA Real Estate S.A. with a maturity date of May 2025 and bearing interest at a rate of 2%.

"Current accounts" are linked to the daily cash pooling mechanism and represent short-term debts bearing interest at market rates.

The loan between the Company and SES Americom was terminated as of 24 October 2018.

NOTE 11 - OTHER CREDITORS - TAX AUTHORITIES

The Company is subject to the tax regulations in

Luxembourg, in Switzerland for the Swiss branch, and in the U.S. for the partnership. In accordance with Article 164bis of the Luxembourg income tax law, SES S.A. is the head of the Luxembourg tax unity with its subsidiaries as follows:

• SES Astra S.A.;
• SES Asia S.A.;
• SES-15 S.à r.l.
• (formerly SES Broadband Services S.A.);
• SES-10 S.à r.l.;
• SES Participations S.A.;
• SES Astra 3B S.à r.l.;
• SES Astra 1KR S.à r.l.;
• SES Astra 1L S.à r.l.;
• SES Astra 1M S.à r.l.;
• SES Engineering S.à r.l.;
• SES Astra 1N S.à r.l..
• SES Astra 5B S.à r.l.;
• SES Astra 2E S.à r.l.;
• SES Astra 2F S.à r.l.;
• SES Astra 2G S.à r.l.;
• SES Astra Services Europe S.A.;
• SES Lux Finance S.à r.l.;
• SES Networks Lux S.à r.l. (formerly SES NL Finance S.à r.l.);
• SES Astra Real Estate (Betzdorf) S.A.;
• 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. (formerly O3b Lux S.à r.l.);
• SES Networks Satellites S.à.r.l. (formerly O3bNext Lux S.à r.l.).

The balance sheet position takes into consideration the net tax payable or receivable by the tax unity to the Luxembourg tax authorities, which is due by the Company as head of the tax unity. The respective tax charge/income of each subsidiary is computed on a stand-alone basis and recharged via intercompany accounts.

NOTE 12 - OTHER CREDITORS - PAYABLE AFTER MORE THAN ONE YEAR

As at 31 December 2018 an amount of EUR 174.1 million (USD 199.4 million) was due to the Company from SES mPOWER S.à r.l. under a forward purchase agreement, corresponding to the constructive obligation recorded by the Company towards the financial institution procuring the satellites. This corresponding obligation to the financial institution is disclosed under the caption 'Amounts due in connection with satellite procurements' on the balance sheet.

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.

At the end of the satellite construction period, which is foreseen in 2021, the SES Group will have the right to acquire, or lease, the satellites from the financial institutionor to direct their sale to a third-party.

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.

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.

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 construction 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 construction milestones are achieved, then the underlying asset-under-construction is transferred by the Company to that entity against an intercompany receivable.

NOTE 13 - OTHER OPERATING INCOME

Other operating income of EUR 16.8 million (2017: EUR 15.2 million) consists mainly of intra-group recharge income from advisory support services rendered to various affiliates.

NOTE 14 - STAFF COSTS

As at 31 December 2018, the number of full time equivalent employees was 57 (2017: 65) and the average number of employees in the workforce for 2018 was 61 (2017: 67). Staff costs can be analysed as follows:

In millions of euros	2018	2017
Wages and salaries	18.7	11.4
Social security costs and other staff costs	1.6	1.5
Total	20.3	12.9

The remuneration for the existing Executive Committee is complemented by EUR 4.4 million total gross remuneration paid to the two departing Executive Committee members.

NOTE 15 - INCOME FROM PARTICIPATING INTERESTS

Income from participating interests concerning affiliated undertakings consists of the following:

In millions of euros	2018	2017
Dividends received from affiliated undertakings	1,354.7	255.2
Total	1,354.7	255.2

Dividends received on own shares in the amount of million EUR 4.7 million (2017: EUR 8.2 million). Dividend received from affiliated undertakings EUR 1,350.0 million (2017: EUR 247.0 million).

NOTE 16 - INCOME FROM OTHER INVESTMENTS AND LOANS

Income from other investments and loans forming part of fixed assets:

In millions of euros	2018	2017
Interest income from affiliated undertakings	25.9	37.3
Total	25.9	37.3

NOTE 17 - OTHER INTEREST RECEIVABLE AND SIMILAR INCOME

Other interest receivable and similar income includes the following:

In millions of euros	2018	2017
Interest income from current account	3.1	0.5
Other interest income from affiliated undertakings	45.0	22.5
Income from external Swap	7.3	-
Foreign exchange gains, net	-	2.3
Total	55.4	25.3

NOTE 18 - VALUE ADJUSTMENTS IN RESPECT OF FINANCIAL ASSETS AND INVESTMENTS HELD AS CURRENT ASSETS

The gain of EUR 25.0 million (2017: EUR 50.6 million) is composed of a loss on disposal of the Company's FDRs for EUR -11.2 million (2017: EUR 12.3 million) and a value adjustment on outstanding FDRs as of 31 December 2018 for EUR 36.2 million (2017: EUR 38.3 million).

A value adjustment has been recorded to account for the FDRs at the lower of their weighted average cost and market price. The value of the SES's share listed on Euronext Paris was EUR 16.71 as at 31 December 2018 (2017: EUR 13.01) which results in a total value adjustment of EUR 36.2 million (2017: EUR 38.3 million).

The loss of EUR 19.3 million (2017: EUR 85.4 million) represents the provision for impairment on shares in affiliated undertakings (see Note 3).

NOTE 19 - INTEREST PAYABLE AND SIMILAR EXPENSES

a) Concerning affiliated undertakings

In millions of euros	2018	2017
Interest charges from current account	35.2	34.7
Total	35.2	34.7

b) Other interest and similar expenses

Other interest and similar financial expenses include the following:

In millions of euros	2018	2017
Interest charges	233.4	221.9
Loan origination costs	12.9	13.9
Loss on disposal on own shares	0.4	1.2
Foreign exchange gains, net	7.9	-
Total	254.6	237.0

NOTE 20 - AUDIT FEES

Art. 65 Paragraph (1) 16º of the Law of December 19, 2002 on the register of commerce and companies and the accounting and annual accounts of undertakings (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 consolidated management report and auditors' report thereon have been lodged with the Luxembourg Trade Registry.

Fees incurred in connection with non-audit services rendered by independent auditor to the Company and its controlled undertakings as defined by the Regulation (EU) N º 537/2014, amounted to EUR 0.2 million, and represent primarily interim dividends reviews, contractual audits, comfort letters issued in connection to the Company's financial transactions and tax compliance services.

NOTE 21 - BOARD OF DIRECTORS' REMUNERATION

Total payments to directors for attendance at the board and committee meetings in 2018 amounted to EUR 1.3 million (2017: EUR 1.4 million). These payments are computed on a fixed and variable basis, the variable part being based upon attendance at board and committee meetings.

NOTE 22 - OFF BALANCE SHEET COMMITMENTS

Guarantees

On 31 December 2018 the Company had outstanding bank guarantees for an amount of

EUR 118.0 million (2017: EUR 130.4 million) with respect to performance and warranty guarantees for services of satellite operations.

Corporate guarantees

In 2018, the Company has given several corporate guarantees to space and ground segment suppliers for the provision of communications spacecraft and related equipment contracted by fully-owned subsidiaries of the SES Group for EUR 0.5 million (2017: EUR 0.5 million).

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 2017 stand alone 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 23 - SUBSEQUENT EVENTS

There were no significant events between the balance sheet date and the approval of the financial statements which would have influenced the results of the Company as at 31 December 2018.

INFORMATION FOR SHAREHOLDERS

FINANCIAL CALENDAR

2018 Full Year Results Announcement 27 February 2019 2019 Annual General Meeting 4 April 2019 2019 Q1 Results Announcement 26 April 2019 2019 H1 Results Announcement 26 July 2019 2019 Q3 Results Announcement 25 October 2019

LISTED SECURITY

Fiduciary Depositary Receipts each in respect of one A share of SES S.A. are listed on the Stock Exchange of Luxembourg and on NYSE Euronext Paris under the symbol SESG.

FIDUCIARY AGENT

Banque et Caisse d'Epargne de l'Etat 16, rue Ste Zithe L-2954 Luxembourg Tel: +352 40 151

SHAREHOLDER ENQUIRIES

SES S.A. Investor Relations L-6815 Château de Betzdorf Luxembourg Tel: +352 710 725 403 ir@ses.com

Created by: zweipunktnull Photo credit: SES, Getty Images

Château de Betzdorf L-6815 Betzdorf Luxembourg

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