Troubled specialist satellite operator Avanti used the Christmas break to issue its slew of bad news contained within its end-of-year results. December 27th saw the statement unveiled, for its trading year to June 30th.
Revenues for the year were just $56.6 million (€47m), down a dramatic $26.2 million on the already worrying 2016 revenues of $82.7 million. Trading loss for the year was $65.7 million (2016: $69.2m).
London-based Avanti fired its co-founder and CEO David Williams back in August 2017, and has since hired Toby Robinson as his replacement. On December 14th, Avanti announced a major financial restructuring where potentially some $500 million of debt will be converted into 2 billion new equity shares, and thus easing the interest payments due on the debt.
Losses were not helped by an attempt at restructuring – and a potential trade sale – all of which came to naught. Chairman Paul Walsh, in his December 27th statement said the “disruption” caused by financial discussions created a lack of confidence amongst customers which is slowly recovering. However, “sales for the year were significantly lower than expected”.
Avanti also announced “impairment” charges on its existing pair of satellites (Hylas 1 by $53 million and Hylas 2 by $61 million).
The operator said its fleet utilisation is up marginally “in the 30-35 per cent band” which is a modest improvement on the previous year’s 25-30 per cent band.
But Avanti also now has a pair of expensive legal problems on its plate. The first concerns the extremely late delivery of Hylas-3. Hylas 3 is not a wholly-owned Avanti satellite, but a hosted payload being carried on a European Space Agency satellite, and is not likely to be ready for launch until “late 2018” and which could slip further. Avanti says: “We are disappointed in the performance of the manufacturer of this system and are considering all options”.
Avanti also revealed that it is involved in litigation with the Government of Indonesia and is involved in arbitration proceedings over a broken contract.
Hylas-4 is likely to be delivered to its French Guiana launch site in January 2018, and launched around March.