Avanti Communications warned investors and shareholders that despite winning some $25 million-worth of new contracts over the past two months, they were unlikely to generate “material revenue growth” during its second-half year of trading.

The demand, such as it is, was mostly generated from new business in Europe and the Middle East. “The new contracts awarded have not arisen in time to generate material revenue growth in Q3 or Q4, but a number of sales of spectrum and other services are under negotiation which could impact in time for year end,” said Avanti in a May 31^st trading update.

David Williams, Avanti’s CEO, added: “The combination of weak macro-economics, especially in Africa, Brexit and industry volatility created significant challenges for our business in the last 12 months. However, we are winning significant contracts again and a degree of optimism is returning, although we will not see significant like for like growth in recurring revenues until the next financial year.”

Avanti said its nine-month revenues were $45.9 milion, but its underlying loss was $11.5million, while cash at the period end was $37.4 million, and it had debt with a face value of $788.5 million (although with a book value of $546.6 million

Drilling down into the numbers, Avanti has turned in revenues of just $13.6 million for the quarter-year, and generated a wider loss from $6 million at the 6-month stage to $11 million now.

More worrying for shareholders is that Avanti continues to spend above its income. The past 3-months have seen expenses of some $25 million, and leaving a cash balance of just $37.4 million.

Avanti’s all-important backlog at the 9-month stage was $233.7 million.  The share price fell back in early trading, but recovered 12p during trading on May 31^st.

On May 19^th it emerged that an Avanti contract/bad debt dispute with a client, Q-Sat, worth £13.6 million, had been cancelled.

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