Intelsat continues to suffer
March 31, 2021
By Chris Forrester
Intelsat, still in the middle of its Chapter 11 bankruptcy reconstruction, continues to be hit by the Coronavirus and other severe headwinds. Its full-year loss for 2020 was a worrying $912 million (€776.3m) on revenues of $1.9 billion.
Intelsat’s CEO Stephen Spengler, said: “The Covid-19 pandemic made 2020 a challenging year; however, we are proud of our ability to maintain a high standard of operations and delivery of mission critical services to our customers. The strategic value of our global network and the services it provides to our customers was reaffirmed during the year. Our mobility customers were significantly impacted by the reduction in travel in both the maritime and aeronautical sectors, yet they renewed contracts and committed to new business with Intelsat. In addition to ongoing business trends, the media services business was also affected by weakening market currencies and a reduction in occasional use revenue, attributable in large part to Covid-19. Satellite network services and the uptake of our FlexGround land mobility managed service drove positive momentum for the government services business.”
Drilling down into the hard numbers, Intelsat revealed that the fourth quarter saw its Network Services division suffer a fall of 9 per cent compared to the same period in 2019, with revenue at $181.7 million.
Q4 Media revenues were $200.6 million (and 42 per cent of Intelsat’s overall revenue) fell by 5 per cent compared with 2019. The decline in media revenue from the prior year reflects the impact of non-renewals due to compression and sector trends, termination of a ground services contract, and the reduction in occasional use services for sporting events and concerts related to Covid.
Government revenue was maintained at $92.7 million, a modest fall of just 3 per cent since the same period in 2019.
Intelsat maintained its average full rate which was steady at 73 per cent (75 per cent in Sept 2019) and with a backlog of $6.1 billion compared with $6.2 billion as at September 30th 2020.
The set-backs in terms of revenue, and commensurate losses, were not helped by significant savings in paying interest and other debt obligations. Intelsat’s net expenses decreased by $185.2 million (or 58 per cent) to $132.7 million during Q4 and compared with $319.9 million for the same quarter in 2019.
Intelsat paid out $50.8 million in bankruptcy costs during Q4.