Avanti hit by new blow
June 27, 2017
By Chris Forrester
Struggling satellite operator Avanti Communications has been hit by more bad news. News has emerged that Avanti’s long-awaited Hylas-3 satellite is to suffer further delays.
The satellite is being built for the European Space Agency (ESA) by Airbus Defense & Space and its main mission is to carry a laser-optical payload (EDRS-C, European Data Relay Satellite) which relays information and data between satellites, spacecraft, drones and ground stations. An earlier satellite, EDRS-A was launched as a hosted payload on Eutelsat 9B and launched in January 2016.
However, the EDRS-C craft, now being built has reportedly suffered a problem in its Ka-band system according to government and ESA officials with knowledge of the system. This Ka-band infrastructure is the portion of the satellite that will be used by Avanti as its Hylas-3 satellite.
The problem with the Ka-band payload has meant the equipment has had to be returned to its manufacturers, MDA Corp., of Canada.
The technical problems mean that the satellite is not likely to be launched until mid-2018, some two years later than originally planned. Hylas-3, when launched, will have 8 beams on a single steerable Ka-band antenna able to cover a segment of Africa or the Middle East. Avanti’s own schematic shows the satellite covering the West African region around Nigeria
The financial consequences of this further delay are that Avanti is unlikely to start earning revenues from Hylas-3 until the third-quarter 2018, and perhaps later if the satellite’s launch date slips even further.
Financially, Avanti is on something of a cliff-edge. Its market capitalization is just $17.5 million, yet it is carrying a debt burden of around $750 million. It refinanced $50 million of that debt on June 16 and borrowed another $50 million to help bridge a financial gap until another satellite is launched (Hylas-4), and to fund its expenses which are currently running ahead of revenues.
Hylas-4 was originally expected to launch in “early 2017” and that slipped to “mid-to-late 2017” according to the company. Sources now suggest that Hylas-4 is to be paired with Abu Dhabi’s Al Yah-3 satellite on Arianespace’s Flight 240, and that is not scheduled until October.
These delays mean that there will be next to zero revenue for Avanti this year from Hylas-4, or Hylas-3.