Avanti jubilant after satellite launch

1st Dec 2010 07:12

Broadband satellite operator Avanti Communications reported a full year pre-tax loss as revenue fell but remained upbeat following the launch of its multi million pound HYLAS 1 satellite from French Guiana 26 November.Shares of Avanti soared earlier this week after the launch of the group's first satellite which, "is currently in orbit and operating as planned under our control," said Avanti chief executive David Williams. "We are confident of achieving the target of selling out HYLAS 1 within three years. With good progress in financing and building HYLAS 2 and the commencement of the HYLAS 3 project, the business changed its scale very dramatically during the year," he added. HYLAS 2 is fully financed and on schedule for launch in Spring 2012, the group explained.In a separate statement Avanti announced it has signed a five year contract, worth $15.5m, with satellite service provider TigrisNet. "TigrisNet, has purchased capacity to provide IP based services in Europe and the Middle East delivered on both Avanti's recently launched HYLAS 1 satellite, and Avanti's HYLAS 2 satellite scheduled for launch in Spring 2012," Avanti said.Meanwhile Avanti reported a pre-tax loss of £1.96m for the year ended 30 June 2010 compared to a pre-tax profit of £1.8m the year before. Revenue for the period fell to £5.82m from £8.04m in 2009 after the group decided to stop selling its service on rented satellite capacity and focused on the HYLAS 1 launch.Commenting on the launch of its satellite, Avanti said, "We now have one satellite in orbit and a second launching in a little over a year, a very strong balance sheet with no debt service payments or cash flow covenants falling due until December 2012, huge untapped markets and a quite thrilling opportunity to create a company of genuine scale.""We have set prudent expectations for the sale of capacity, with a target of three years to fill HYLAS 1 and five years to fill HYLAS 2. It appears that the markets we serve are more than strong enough to achieve this many times over," it added.