Avanti Communications Share Discussion Threads

[smarm] 21/12/2010 15:05

2dvm - thanks for that, very useful. The report says it all....2011 needs to bring with it the visibility to increase forecasts. Not so good is the delay in getting the service launched...I think we were all expecting it to be a little earlier than that. I think the price has held up remarkably well.

S

[2vdm] 21/12/2010 15:04

Hope the above will be of genearl interest to newcomers and that the increased valuation range helps to dissuade some of the recent derampers who have invaded this thread.

[mike292] 21/12/2010 14:58

Thought this of interest

: "UK-Analyst: Tip of the Day"

21st December 2010 Analyst: Derren Nathan
Email: [e-mail]
Tel: [phone]

Avanti Communications* - Successful launch of Hylas 1 de-risks valuation. Contract wins accelerating. Reiterate Stance of Strong Buy with a valuation range between 1,079p and 2,194p

Mike

[2vdm] 21/12/2010 14:57

Just been emailed this from UK Analyst - "The textbook launch of Avanti Communications first satellite Hylas 1, eliminates much of the execution risk for Avanti to become the first provider of Ka band bandwidth to a plethora of new customer groups, across Europe, and in the future to other territories. Based on our valuation model detailed in our note of 9th of November we can now close off our downside valuation. This now gives a valuation range from 1,079p to 2,194p as opposed to 871p to 2,194p.

On 15th of December Avanti confirmed that Hylas 1 had reached geostationary orbit and that the lower than expected fuel burn to get the satellite into position will extend the satellite's useful life. We are assuming 2 extra years at 45% capacity. Revenue optimisation tests are now taking place and commercial services should be launched towards the end of the first quarter calendar year 2011, which equates to the third quarter of Avanti's financial year. This is later than our earlier expectation but the valuation effect of the above factors is broadly neutral and we leave our base case target price unchanged.

We have reduced our 2011 revenue forecasts accordingly from GBP9.5 million to GBP5.3 million, reflecting the short period of service Hylas 1 will offer in this financial year. We have raised our pre-tax loss expectation to GBP12.7 million. We have also introduced forecasts for the year ending June 2012. We see Hylas 1 ramping up to just over 50% average utilisation which we believe will generate GBP28.8 million revenues EBITDA of GBP10.8 million and a pre tax profit of GBP3.3 million. This is just with one satellite running at close to half capacity. By 2014 Hylas 1 should be close to capacity, and Avanti should have launched at least a second and quite possibly a third larger satellite.

Avanti released its full year results for the year ending 30th June 2010 on 1st December. Given the successful launch of Hylas 1 post year end, these results are not reflective of the business going forward. Revenues were down by 17% to GBP5.82 million as Avanti wound down its loss making pilot broadband operations. The loss before tax of GBP1.9 million was in line with our expectations. However these operations allowed the company to develop in house software for hosting satellite broadband services for less than GBP0.5 million, something that would have cost many times more if it had been developed by a third party. The post balance sheet fund raising of GBP70 million leaves an un-geared balance sheet. The company faces no debt payments or bank covenants for the next two years.

Following the post launch euphoria Avanti has wasted no time in focussing at the task in hand which is to fill capacity on Hylas 1 and its next planned Satellite Hylas 2. The company already has 62 customers signed up with sales offices in Spain, Italy, Poland and Cyprus. It plans to open offices in Turkey and South Africa. Within a week of the launch the company has already announced to further high profile contracts.

On 30th November the company announced that it had signed a 5 year agreement with BT for the provision of satellite broadband services. Avanti will supply satellite broadband services as required by BT as part of a recently announced GBP132 million next generation access project in Cornwall and the Isles of Scilly, of which BT is a major partner. The agreement is not limited to Cornwall, however, and will allow BT to provide satellite broadband services to other parts of the UK. The estimated contract value is GBP1.2m. However the fact that the national carrier has put its faith in Avanti is of greater significance, and BT may end up purchasing more bandwidth for similar projects in other remote areas. BT will be able to offer satellite broadband to any of its customers under the framework agreement.

On 1st December the company signed a USD15.5 million contract with TigrisNet for space on both Hylas 1 and 2. TigrisNet has a range of customers in Iraq including the military and Government bodies. This is an important new market for Avanti.

The launch of Hylas 1 is only the beginning for Avanti Communications. New contracts and milestone developments for Hylas 2 (on schedule for launch in Spring 2012) should ensure a steady stream of news flow for the company. Looking further ahead we expect news concerning the financing of Hylas 3, which is likely to cover parts of the Americas, within a year. The company has stated that it is also considering plans for a 4th satellite. Our base case valuation of 1,079p per share is on conservative assumptions regarding pricing and the rate of sale for Hylas 1 and 2. Over 2011 we hope to get more visibility on this which may enable us to move our base case valuation towards our upside case of 2,194p. As certainty over Hylas 3's financing emerges and perhaps even Hylas 4, we anticipate being to extend our upside range further."

[yorgi] 21/12/2010 14:50

Yes Pojscott but I'm quite confident on news that Hylas1 is in service and a few more contracts won we will see a rapid change in the share price

I wouldn't worry.......annoying yes if you had been intending to sell a few at the moment but looking into next year and beyond it will not matter a jot if David Williams and his team keep doing the business :-)

Ignore the share price and focus on the facts

[pojscott] 21/12/2010 14:35

smarm--Thaks for that. Problem has been that the S/P seems to go down on any good news following launch.

[smarm] 21/12/2010 14:28

pojscott - understandably so. I'm just going to be patient and wait for the service to start and the contracts to roll in and then Hylas 2/3 and whatever comes next. If you wonder what can be achieved then take a look at ISAT. The risk is that the service can't deliver, that the contracts don't roll in but as I bought at 163, I can't really lose from here. You must do what is right for you. It is quite common for stocks to fall back in this way, buy the rumour, sell the fact but if you look at the chart you will see that it is still in an uptrend. NAI, DYOR.

I will check the shorting figures end this week...if they have increased and I suspect that they will...you must also remember that on any good news they will close enmasse. Seen it so many times before.

S

[pojscott] 21/12/2010 13:46

After all above is said and done--the share price continues to go down!
Starting to get a bit concerned now.

[smarm] 21/12/2010 11:29

ib - that's a shame but have fun and remember we will still be here if you can't resist the temptation.

S

[ib1905] 21/12/2010 11:17

Right, I am sure I wont be missed but i am off. i will not read this thread as nothing is to be gained by it. To those of you who have informed and at times helped me with this investment, thank you. To the clown and idiot who has f...ed the whole thing - up yours, and to those who could not show restraint by filtering him and couldn't resist responding to the deluded child - grow up.
I will carry on holding this stock, but without what used to be the cameraderie that went with it.

[yorgi] 21/12/2010 11:06

Thanks Smarm, Jimbo MT and Mike and anyone else I may have missed for your support.

Filter and ignore is the only answer and I'm quite confident that AVN will soon do the talking for us. David Williams and has team have so far performed and I have no doubt will continue to do so in the new year.

[marksnsparkle] 21/12/2010 10:48

jonnib ... good plan superg1 now filtered

[superg1] 21/12/2010 10:34

Finally you are learning keep sniping and I will keep posting. i've said that all along. No I won't go away until ADVFN get their act together, once they have acted off I'll go.

[smarm] 21/12/2010 10:31

Yes. I keep saying I will ignore and then then I don't. Guilty as charged. I have filtered now.

S

[jonnib] 21/12/2010 10:28

Lets see if we can ignore all posts from superg1 for the rest of the week.....come on guys dont respond to anything and he/she will get tired. We all know what a great company this is and have done our own research. IGNORE ALL POSTS

[mike292] 21/12/2010 10:22

Yorgi - saw this on the XEL board header

Please make sure you read the rest of this header. The thread is moderated and there are some basic rules to adhere to. Please respect other posters even if they have a different view. If you want anything adding to the header then let me know. IF CERTAIN USERS ATTACK THE BOARD, PLEASE DO NOT RESPOND.I will add them to the embargoed list. Blues cannot be moderated, so you must filter them to remove any temptation. If you do engage them, you will have to suffer the consequences.ANYBODY ENGAGING THEM IN ANY WAY WILL ALSO FIND THEMSELVES EMBARGOED.

Hope it helps

Mike

[superg1] 21/12/2010 10:22

Put my on filter that is ADVFN's advise if you don't like my posts, simple. As for Yorgi being balanced what was the post

adyfc2 - 17 Dec'10 - 18:03 - 2428 of 2431.

Of course no doubt he is one of my team.

As he is not a paid up member I presume he can't post anymore. The first thing you wanted to do with me was ban me for posting an altenative view. That is what BB's are for and ADVFN will not ban anyone for having a different opinion.

Read the T and C

[malcolmmm] 21/12/2010 10:21

I agree with M.T. Glass this thread has degenerated into juvenile sillyness, best to ignore the shorters and all their obvious nonsense

[mike292] 21/12/2010 10:04

I own AVN shares and have been following this useful thread for some time. It seems a shame that it is been ruined by a minority. When faced with idiots, I have found Dale Carnegie, -"How to stop worrying and start living" most useful. He suggests that if they wind you up, they have won. If you resist from being wound up, you win. Suggest that we all filter idiots and do not respond to them.
This is a great company and a very useful hedge against going full on into mining, gold and silver. I have found the comments from most posters very useful. Nuff said :X

[blue forever] 21/12/2010 10:03

I think the lunatic has finally taken over the asylum! Blame Care in the Community personally,never thought that was a good idea.

[smarm] 21/12/2010 09:47

Yorgi - you have run this thread brilliantly, for which we are all appreciative.

S

[smarm] 21/12/2010 09:38

Superg - are you new to bulliten boards? If you are then you will not know that all threads are to some extent 'controlled'. And when you join a thread you should be polite and follow the direction you are given.

You comment that all the brokers are paid or tied. Yes, that's how it works.

You claim over-enthusiasm. No law against that so long as we stick to facts or opinion.

I can see no great crime, or any crime on iii, I just see a vindictive individual on a childish crusade.

S

[jimbo55] 21/12/2010 09:35

superg1, that's bollucks. Yorgi has been around on ADVFN for at least as long as I have, and I've never once seen him ban people for having alternative points of view. This is becoming more surreal by the day. I continue to question your motivation in posting here. You've moved from being possibly credible, into the clown category.