Intelsat Q1: Losses trimmed

Intelsat’s Q1 saw overall revenues of $538.5 million [€493m] (down 2.6 per cent on 2016 y-o-y from $552.6 million) but with considerable shrinkage of its all-important backlog. This latest quarter-year saw backlog (the value of contracts in hand) and which are currently valued at $8.5 billion, reduced from $9.3 billion at the same time last year.

On the upside, Intelsat’s CEO Stephen Spengler has re-confirmed the satellite operator’s overall guidance for 2017. “Revenue of $538 million and Adjusted EBITDA of $410 million for the first quarter reflect our continuing business transition as we continue to make progress on the initiatives that will enable new services and create top line growth for our company. Over the course of the first quarter, Intelsat 33e and Intelsat 32e entered into service. Our managed services, IntelsatOne Flex, are attracting new customers and will begin to generate incremental revenues as these networks activate over the course of 2017.”

Spengler continued, “Growth in our media business was driven by the two fully-committed satellites placed into service in 2016.  While we continue to work through some near-term headwinds, our network services and government businesses are leveraging the higher performance services available from the Intelsat Epic network, which is now available on five continents.  Backlog as of March 31st 2017 was $8.5 billion.”

Key to the operator’s prospects for the future is the planned “conditional merger” with Jersey-based super constellation OneWeb, and expected to close during Q3. Spengler said: ““Our proposed conditional merger with OneWeb, which was announced on February 28th, is pending completion of our announced debt exchange transactions and receipt of certain other approvals. We believe the transaction creates a company with greater growth opportunities and a strong financial foundation.”

Intelsat’s key metrics showed:

  • Network Services revenue was $212.9 million (or 39 per cent of Intelsat’s total revenue) for the three months ended March 31st 2017, a decrease of 7 per cent compared to the same period last year.
  • Media revenue was $225.1 million (or 42 per cent of Intelsat’s total revenue) for the three months ended March 31st 2017, an increase of 6 per cent compared to the three months.
  • Government revenue was $91.9 million (or 17 per cent of Intelsat’s total revenue) for the three months, a decline of 11 per cent y-o-y.

Intelsat’s average fill rate on its approximately 2,050 station-kept wide-beam transponders was 78 per cent at March 31st 2017, compared to 77 per cent as of December 31st 2016.

“Note that Intelsat 31, an in-orbit spare satellite, is not included in the station-kept transponder count. Separately, our fleet includes approximately 650 36MHz units of high-throughput Intelsat Epic capacity,” stated the company.

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