Eutelsat S.A. Group “Société anonyme” with a capital of 658,555,372.80 euros Registered office: 70, rue Balard 75015 Paris 481 043 040 R.C.S. Paris CONSOLIDATED FINANCIAL STATEMENTS AS OF 30 June 2018 Eutelsat S.A. 1 NOTE.1 KEY EVENTS DURING THE FINANCIAL PERIOD ..................................................... 9 NOTE.2 GENERAL OVERVIEW .................................................................................................... 9 NOTE.3 BASIS OF PREPARATION OF FINANCIAL INFORMATION ..................................... 9 NOTE.4 SIGNIFICANT ACCOUNTING POLICIES .................................................................... 11 NOTE.5 GOODWILL AND OTHER INTANGIBLES .................................................................. 19 NOTE.6 SATELLITES, OTHER PROPERTY AND EQUIPMENT AND CONSTRUCTION IN PROGRESS ........................................................................................................................................... 20 NOTE.7 INVESTMENTS IN ASSOCIATES ................................................................................. 21 NOTE.8 ASSETS HELD FOR SALE ............................................................................................. 21 NOTE.9 NON-CURRENT FINANCIAL ASSETS ........................................................................ 21 NOTE.10 INVENTORIES ................................................................................................................ 21 NOTE.11 ACCOUNTS RECEIVABLE ........................................................................................... 22 NOTE.12 OTHER CURRENT ASSETS .......................................................................................... 23 NOTE.13 CURRENT FINANCIAL ASSETS .................................................................................. 23 NOTE.14 CASH AND CASH EQUIVALENTS .............................................................................. 23 NOTE.15 FINANCIAL ASSETS ...................................................................................................... 24 NOTE.16 SHAREHOLDERS' EQUITY ........................................................................................... 26 NOTE.17 FINANCIAL DEBT .......................................................................................................... 29 NOTE.18 OTHER FINANCIAL LIABILITIES ............................................................................... 30 NOTE.19 FINANCIAL LIABILITIES ............................................................................................. 31 NOTE.20 OPERATING AND FINANCE LEASES ........................................................................ 32 NOTE.21 OTHER PAYABLES AND DEFERRED REVENUES ................................................... 33 NOTE.22 INCOME TAX .................................................................................................................. 33 NOTE.23 PROVISIONS ................................................................................................................... 36 NOTE.24 SEGMENT INFORMATION AND PERFORMANCE INDICATORS ......................... 39 NOTE.25 FINANCIAL RESULT ..................................................................................................... 42 NOTE.26 EARNINGS PER SHARE ................................................................................................ 42 NOTE.27 DERIVATIVE FINANCIAL INSTRUMENTS ............................................................... 42 NOTE.28 PURCHASE COMMITMENTS ....................................................................................... 45 NOTE.29 LITIGATION AND CONTINGENT LIABILITIES ........................................................ 46 NOTE.30 RELATED-PARTY TRANSACTIONS ........................................................................... 47 NOTE.31 STAFF COSTS ................................................................................................................. 48 NOTE.32 SCOPE OF CONSOLIDATION ....................................................................................... 49 NOTE.33 SUBSEQUENT EVENTS ................................................................................................ 50 NOTE.34 STATUTORY AUDITORS’ FEES .................................................................................. 50 Eutelsat S.A. 2 CONSOLIDATED BALANCE SHEET (1) (in millions of euros) Note 30 June 2017 30 June 2018 ASSETS Non-current assets Goodwill 5 343.0 389.7 Intangible assets 5 317.2 312.7 Satellites and other property and equipment 6 4,134.0 3,942.3 Construction in progress 6 759.9 819.4 Investments in associates 7 (0.4) 4.3 Non-current financial assets 9, 15 21.0 15.2 Deferred tax assets 22 4.7 4.5 Total non-current assets 5,579.4 5,488.2 Current assets Inventories 10 3.0 2.1 Accounts receivable 11 345.4 330.3 Other current assets 12 46.3 35.5 Current tax receivable 4.5 4.5 Current financial assets 13, 15 29.7 16.9 Cash and cash equivalents 14 406.0 704.6 Total current assets 834.9 1,093.9 Assets held for sale 8 300.7 - Total assets 6,715.0 6,582.1 (1) Comparative financial statements have been restated for the items shown in Note 3.6."Periods presented and comparatives". Eutelsat S.A. 3 (1) (in millions of euros) Note 30 June 2017 30 June 2018 LIABILITIES AND SHAREHOLDERS' EQUITY Shareholders' equity Share capital 16 658.6 658.6 Additional paid-in capital 8.0 8.0 Reserves and retained earnings 1,432.2 1,374.1 Non-controlling interests 117.9 96.3 Total shareholders' equity 2,216.7 2,136.9 Non-current liabilities Non-current financial debt 17, 19 2,879.3 2,068.4 Other non-current financial liabilities 18, 19 798.1 695.8 Non-current payables to fixed assets' suppliers 27.3 18.0 Non-current deferred revenues 21.1 119.3 101.3 Non-current provisions 23 97.3 107.1 Deferred tax liabilities 22 187.8 167.8 Total non-current liabilities 4,109.0 3,158.4 Current liabilities Current financial debt 17, 19 60.7 860.6 Other current financial liabilities 18, 19 67.6 150.8 Accounts payable 19 52.7 54.7 Current payables to fixed assets' suppliers 40.1 44.7 Taxes payable 2.1 7.9 Other current payables and deferred revenues 21.2 130.7 137.6 Current provisions 23 35.5 30.5 Total current liabilities 389.3 1,286.8 Total liabilities and shareholders' equity 6,715.0 6,582.1 (1) Comparative financial statements have been restated for the items shown in Note 3.6."Periods presented and comparatives". Eutelsat S.A. 4 CONSOLIDATED INCOME STATEMENT (in millions of euros, except per share data) Note 30 June 2017 30 June 2018 Revenues from operations 24.2 1,481.3 1,410.6 Operating costs (98.9) (96.8) ) Selling, general and administrative expenses (239.9) (229.8) Depreciation and amortisation 5, 6 (488.4) (461.5) (1) Other operating income 31.1 - (2) Other operating expenses (17.1) (18.5) Operating income 668.1 604.1 Cost of debt (121.6) (91.0) Financial income 1.5 1.2 Other financial items (4.4) (13.3) Financial result 25 (124.5) (103.1) Income from associates 7 (0.4) (2.2) Net income before tax 543.2 498.7 Income tax expense 22 (144.8) (186.1) Net income 398.4 312.6 Attributable to the Group 400.8 315.5 Attributable to non-controlling interests (2.5) (2.8) (3) 26 0.396 0.311 Basic and diluted earnings per share attributable to Eutelsat S.A. shareholders (1) The other operating income is mainly related to proceeds from the disposal of the entities Wins and DHI during the year ended 30 June 2017 (see Note 3.7 – Changes in scope of consolidation). (2) Other operating expenses mainly include scrapped assets and provisions as of 30 June 2017 and 30 June 2018, as well as a 7.7 million euro expense for pre-existing relationships with Noorsat as of 30 June 2018. (3) There are no dilutive instruments as of 30 June 2017 and 30 June 2018. Eutelsat S.A. 5 COMPREHENSIVE INCOME STATEMENT 30 June 2017 (1) (in millions of euros) Note 30 June 2018 Net income 398.4 312.6 Other recyclable items of gain or loss on comprehensive income Translation adjustment 16.5 (35.9) (26.5) Tax effect 16.5 (4.9) (4.9) Changes in fair value of hedging instruments (2) 16.4 46.9 (33.6) Tax effect 22.2 (16.1) 11.4 Other non-recyclable items of gain or loss on comprehensive income Changes in post-employment benefits 23.4 (2.0) Tax effect 22.2 (11.5) (1.2) Total of other items of gain or loss on comprehensive income 1.7 (56.8) Total comprehensive income 400.1 255.8 Attributable to the Group 402.6 258.7 Attributable to non-controlling interests (2.5) (2.7) (1) Comparative financial statements have been restated for the items shown in Note 3.6."Periods presented and comparatives". (2) Covers only cash-flow hedges. Net foreign investment hegdes are recorded as translation adjustments. Eutelsat S.A. 6 CONSOLIDATED STATEMENT OF CASH FLOWS (in millions of euros) Note 30 June 2017 30 June 2018 CASH FLOW FROM OPERATING ACTIVITIES Net income 398.4 312.6 Income from associates 7 0.4 2.2 Tax and interest expense, other operating items 258.9 301.0 Depreciation, amortisation and provisions 504.0 484.9 Deferred taxes 22.1 (18.0) (14.2) Changes in accounts receivable 53.2 (35.0) Changes in other assets 0.8 5.8 Changes in accounts payable (3.6) 5.8 Changes in other debt (62.8) (12.1) Taxes paid (165.5) (185.2) Net cash flows from operating activities 965.7 865.9 CASH FLOWS FROM INVESTING ACTIVITIES Acquisitions of satellites, other property and equipment and intangible assets 5, 6 (393.0) (298.8) Acquisition of subsidiaries 3.7 - (61.4) Sale of entities 36.7 302.0 Dividends received from associates and other items 7 4.5 (5.2) Net