Avanti Communications Share Discussion Threads

[terryebby] 07/1/2010 20:37

Apparently Cenkos have released a new report with a short term price target of £13.58. Yes, THIRTEEN POUNDS FIFTY EIGHT PENCE

[jonnyno1] 06/1/2010 12:54

Excellent , i believe this was well oversubscribed. I do enjoy comments like "transformational transaction" and "The response to our announcement from potential
customers has already been very strong". Onwards and upwards!

[dolores123] 06/1/2010 12:19

Encouraging comments in today's rns.

[khitchen] 31/12/2009 12:13

i have thankyou i hold 3000 shares , free float info can be very valuable on shares like this

[strollingmolby] 31/12/2009 10:44

Whoops, you're quite right, AA29. EBT + Directors' holdings = 13.44%.

Still, I think khitchen has the information s/he needed.

[aa29] 31/12/2009 02:55

StrollingMolby - you're mistaken. The 13.44% has nothing to do with the free float - it's the total of Directors' holdings plus those held by the Employee Benefit Trust.

[khitchen] 30/12/2009 19:48

thankyou strollingmolby

[strollingmolby] 30/12/2009 16:30

13.44% excluding EBT shares.

[khitchen] 30/12/2009 16:14

can anyone tell me how many shares are not in institutional hands, i.e free float

[terryebby] 30/12/2009 15:19

Tom tipped this for the first time at 117p in 2004 (trebled your money in five years) and now says buy at up to 500p with expectation of hitting 850p in 2010 and 1300p by 2011. Where else can you double your money in a year and treble it in two ?????

Avanti Communications* - More on Placing
1 Days ago (2009-12-29 10:24:20)
Print this Article Avanti Communications* - More on Placing
Avanti* (AVN) announced today that a further 750,000 shares had been placed at 400p so meaning that it has raised £89 million rather than £86 million for satellite 2. Essentially this is just helping out a fund which missed the deadline for internal reasons. The dilution is relatively trivial. In my last update I concluded:

Put another way, we can now be confident that by 2012 this company should be generatin a pre-tax profit of £80 million or more. On a standard tax charge that equates to earnings per share of 89p. Now as it happens I think earnings will be greater than that since my assumptions are based on a pretty cautious take on rental rates. And earnings will be boosted by 2013 by the launch of satellite 3. But even on 89p and a PE of 15 (not that high for a growth story with great earnings visibility) we get a target price of £13.35. Therefore, and although we are already significantly ahead on the 117p 2004 t1p price, I upgrade, at up to 500p, to "buy" with a 1 year target of 850p.

Ends.

It has been suggested that this target is rather lame. Cenkos - the house broker - reckons that a DCF valuation of £14 is about right. House broker's are paid to be bullish (earning commission of up to 5% on equity fundraisings) I am not. Heck, I can construct a model which supports a DCF valuation of £14 ( or higher if I tweak my assumptions the correct way). You can see from the above that I reckon that the shares should be trading at £13 plus by 2012 ( arguably 2011 as the market always looks a year ahead) but for now there are still risks ( launch risks, operational risks, transactional risks - sales still have to be booked) and so I opt to risk weigh forecasts an d assumptions accordingly. At 457p the stock is now almost 300% ahead of my original tip price but it is still clearly cheap. Buy at up to 500p with a one year target of 850p.

[khitchen] 29/12/2009 17:15

can anyone tell me how many free shares there are

[dolores123] 29/12/2009 08:40

Kinkell- have a read of the various RNSs issued by AVN - that should convince you!

[kinkell] 25/12/2009 19:49

Dolores123,

Could you please explain why Hylas 1 will resolve existing problems with Avanti's current broadband service? (-assuming that is what you mean.)

[dolores123] 24/12/2009 08:59

A quiet day - although some buying has gone through Plus market.

Merry Xmas all.

Ps - if over the hols you are in an area with no decent broadband just wait till June 2010 when Avanti's Hylas 1 will solve all your broadband problems!!

[jonnyno1] 22/12/2009 10:49

last placing was well oversubscribed , i suspect the same here.

[jonnyno1] 22/12/2009 10:00

a little adventurous but i like it!

[dolores123] 22/12/2009 09:23

£2 per share before tax equates to 1.44 after tax.

On a conservative P/E of say 20 for this growing company the share price would be £28!!

Thats a multiple of almost 7 from todays price.

[jonnyno1] 22/12/2009 08:29

onwards and upwards!

[terryebby] 22/12/2009 08:26

FT quote: "Avanti said Hylas 2, which it expects to launch in 2012, will increase capacity and revenue three fold and help it achieve a pre-tax profit of about £140m." Thats PROFIT BEFORE TAX of £2 per share

[johnroger] 21/12/2009 19:29

21st December 2009 Analyst: Steven Moore
[e-mail]
020 7562 3392



Avanti Communications Group* - Placing and Debt to fund Hylas 2 satellite

Reiterate 'Buy' at 441.5p; Target Price increased to 837p




Key Data

EPIC
AVN

Share Price
441.5p

Spread
435p – 448p

Total no of shares
66,422,065 (post placing and including 3,047,224 in Employee Benefit Trust)

Market Cap
£293.25 million

12 Month Range
154p – 475p

Market
AIM

Website
www.avanti-communications.com

Sector
Mobile Telecommunications

Contact
David Williams (Chief Executive)
020 7749 1600

Avanti Communications Group*, the broadband satellite company, has announced that, conditional on shareholder approval, it is to raise £86 million in a placing of 21.5 million new shares at 400p each to help fund the procurement, launch and operation of a second satellite; Hylas 2.

These placing proceeds will complement £194 million of debt facilities that Avanti has secured from The Export-Import Bank of the United States, the official export credit agency of the United States, and COFACE, a subsidiary of Paris-listed Natixis, which are to make debt available in support of their own national manufacturers - Avanti will procure the Hylas 2 satellite from Orbital Sciences Corporation of the USA and purchase a launch service from Arianespace of France. Ex-Im Bank is to be a direct lender to Avanti whilst COFACE provides a guarantee to a commercial bank which then becomes the lender of record. COFACE's offer of guarantee is open for acceptance until March 2010 and Avanti is working with a commercial bank to complete the necessary debt facility documentation. The Hylas 2 satellite is planned to launch in the first half of 2012.

Hylas 2 is to offer 8,280 MegaHertz of capacity, versus the 3,000 MHz of Hylas 1 – providing it with the capacity to serve up to 1 million broadband customers, compared to the 350,000 servable by Hylas 1. It will duplicate Hylas 1 coverage over Europe, which will see Avanti become the only company in Europe to offer dual-redundant Ka band coverage to its customers, as well as also providing European service provider customers with more capacity. Additionally, Hylas 2 will provide Avanti new coverage in Eastern Europe, the Middle East and parts of Eastern and Southern Africa – markets which, given a relative shortage of high quality terrestrial infrastructure, are expected to offer strong demand at attractive pricing. Hylas 2 will also have the flexibility to move power between Europe and the newer markets to maximise returns.

In our detailed note of 5th November we applied an additional 85% risk weighting to our discounted cash flow model for a second satellite to reflect the early stage of development (e.g. financing not having been finalised, procurement not having taken place, forward sales not having been sought). We consider that today's news significantly de-risks the proposition and accordingly reduce that risk weighting to 25%. We consider even this conservative since all the evidence (including from forward sales of Hylas 1 capacity) is that demand is very strong. Including Hylas 1 and a heavily risk weighted (90% on discounted cash flow derived value) contribution from a third satellite, we reach an updated target price of 837p per share. With today's news set to see Avanti gain additional satellite revenue generating capacity of 276% from equity dilution of less than 50%, our stance, at 441.5p, remains buy.






Forecasts Table

Year to 30th June
Turnover
(£ million)
Normalised Pre-tax Profit (£ million)
Normalised Earnings Per Share (p)
Price Earnings Ratio
Dividend Per Share (p)
Dividend Yield (%)

2008A
5.92
(1.47)
(5.30)
-
0.0
-

2009A
8.04
(1.13)
(4.10)
-
0.0
-

2010E
7.00
(1.25)
(2.38)
-
0.0
-


*The SF t1ps Smaller Companies Growth Fund, managed by a subsidiary of Rivington Street Holdings, the ultimate owner of GE&CR, owns shares in Avanti Communications Group.








This research note cannot be regarded as impartial as GE&CR has been commissioned to produce it by Avanti Communications Group*.
This research note cannot be regarded as impartial as GE&CR has been commissioned to produce it by the company, it should be regarded as a marketing communication.

The information in this document has been obtained from sources believed to be reliable, but cannot be guaranteed. Growth Equity & Company Research is owned by T1ps.com Limited which is commissioned to produce research material under the GE&CR' label. However the estimates and content of the reports are, in all cases those of T1ps.com Limited and not of the companies concerned.

This research report is for general guidance only and T1ps.com Limited cannot assume legal liability for any errors or omissions it might contain. Readers of this report should also be aware that because this research is not independent that there is no prohibition on dealing ahead of the dissemination of it.

The value of investments can go down as well as up and you may not get back all of the money you invested; You should also be aware that the past is not necessarily a guide to the future performance. Finally, some of the shares that are written about are "smaller company" shares and often the market in these shares is not particularly liquid which may result in significant trading spreads and sometimes may lead to difficulties in opening and/or closing positions. Before investing, readers should seek professional advice from a Financial Services Authorised stockbroker or financial adviser.

T1ps.com Limited is authorised and regulated by the Financial Services Authority (FSA Registration no. 192801) and can be contacted at 5-11 Worship Street, London, EC2A 2BH – email email [e-mail] - fax [phone] - tel [phone]

[dadro1] 21/12/2009 11:07

Since the publication of our detailed note on the 5th November this broadband satellite operator has signed a 3 year VNO contact with Digisat Media of Spain. This is the first contract that will use HYLAS capacity for the distribution of radio station content to local broadcast points across the country. Digisat works with both broadband and digital media applications and together with Avanti expects to generate significant additional business. Avanti will begin services for Digisat on its leased capacity, transferring to HYLAS after the summer 2010 launch. Our target price set at 718p remains unchanged as does our stance of buy.

[terryebby] 21/12/2009 09:52

three times as much capacity, but costs dont go up much. the effect on eps is pretty obvious .....

[5070481] 21/12/2009 07:48

i was even happier with the amount of debt that they managed to secure for it rather than having to do a hugely discounted placing

[codhead1] 21/12/2009 07:14

Very very happy with these guys. Satelite 2 funds raised at £4 in todays market is a clear testament to the potential.

[cancun tango] 18/12/2009 16:42

I'm writing just to make some noise, this thread can get very quiet. Can anyone explain the strange trading pattern on this share? There were a lot of 1 share trades today, and quite often there are single digit trades. Selftrade charge £12.50 a trade (any advice on where to trade cheaper much appreciated), why would anyone buy shares less than ten at a time?