Avanti Communications Share Discussion Threads

[malcolmmm] 04/1/2011 17:06

M.T it was the fact that they had 'extra design activities built into HYLAS1' as shown below and will be able to offer certain new services, what these are I do not know.


Avanti Communications* (AVN) has confirmed the successful launch of Hylas 1, the first superfast broadband satellite launched for Europe, from the Kourou Space Centre, French Guiana. All systems checks are noted to have shown full functions working correctly. Avanti Chief David Williams added "before we begin to put customer traffic onto the satellite in the New Year, we will be working to enhance the revenue generating potential of the satellite. As a result of certain extra design activities during manufacture Hylas 1 has higher performance than the original design provided for and is able to offer certain new services. We will analyse the precise performance characteristics of the satellite in these operating modes before commercial service commences




Avanti Communications* (AVN) has confirmed the successful launch of Hylas 1, the first superfast broadband satellite launched for Europe, from the Kourou Space Centre, French Guiana. All systems checks are noted to have shown full functions working correctly. Avanti Chief David Williams added "before we begin to put customer traffic onto the satellite in the New Year, we will be working to enhance the revenue generating potential of the satellite. As a result of certain extra design activities during manufacture Hylas 1 has higher performance than the original design provided for and is able to offer certain new services. We will analyse the precise performance characteristics of the satellite in these operating modes before commercial service commences





The steady price rise for satellite capacity demonstrates that demand is outstripping supply. Due diligence undertaken by Coface and EXIM at the time of the Hylas 2 funding estimated that there are 100m homes in EMEA with inadequate broadband provision. Satellite broadband is the only cost effective means of addressing this market in the majority of cases. To put this in context demand would fill c400 Hylas 1 satellites or c60 of Avanti's pipeline fleet. Avanti has a clear first mover advantage with Hylas 2 and 3 expected to be launched by the end of 2012. As the market continues to develop we believe the growing demand for Ka-band capacity will drive further price increases.

Landmark launch and continued newsflow will drive share price

Whilst the results demonstrate management's ability to control costs the successful launch of Hylas 1 is the culmination of years of work by management and employees. Further, lessons learnt with the development of Hylas 1 will come to the fore in the development of Hylas 2 and 3. The company reporting that development is on track for launch of both satellites in 2012.

We anticipate further newsflow now that Hylas 1 has been successfully deployed as demand for launched capacity increases. The BT deal is of great commercial significance as it adds to the company's reputation in the market and the contract value will ramp up as BT rolls out the service. TigrisNet demonstrates Avanti's ability to sign large, multi region deals where broadband infrastructure is required from one provider across various countries.


The investment case for Avanti has never been stronger. The Avanti shares offer incredible value both on a price earnings and sum of the parts basis. The NPV of Hylas 1, 2 & 3 is c2300p using conservative discount rates, particularly now that Hylas 1 has been launched. Management believe revenues will begin in March 2011 which has led us to revise our FY11 forecast to revenue of £9.4m (from £19.1m) and a loss before tax of -£10m (from -£3.4m). This revision is up for review as timings and ramp up become clear over the next couple of months at which time we will update the market. We are confident that capacity will be filled by June 2012 leading us to leave our forecast numbers unchanged post FY11.

[volsung] 04/1/2011 16:54

Odd time to leave smarm. Right on the trendline but you know the stock better than most

[m.t.glass] 04/1/2011 16:49

Malcolm you say "I believe quality of their products and service is superior.."

The question was asked on this thread a week or two ago if anyone had any detailed comparisons on which to make such a judgment - and nothing emerged. What data have you found that supports your belief?

[yorgi] 04/1/2011 16:43

Time will tell whether you have made the right call Smarm but I have to say with the way oil and mining stocks are performing I quite understand your thinking it did cross my mind today to sell some but I didn't.

[smarm] 04/1/2011 16:32

I am now out...will pick them up again around £6 I reckon. Shame, I thought they would keep on going.

S

[2350220] 04/1/2011 15:53

The way this has dropped today, you'd swear that we'd had another contract win!!

John

[backmarker] 04/1/2011 13:37

back to AVN. not the strongest performer in the last month, but consolidating above the uptrend and looking ready to lift off again.

EutelSat may well be bigger and could potentially steal some of Hylas's sales short-term, but the market should be more than big enough to absorb both sat's capacities right now. until we start getting saturation with a new Ka-sat launched every month or so, a bit of competition might even be good, as the quicker the usage of this technology grows the more the demand is likely to grow also, and keep revenues at the higher end.

in the short-term the name of the game is to demonstrate the tech works reliably and is good value, rake in the customers asap and get the next satellites up there while you still have leadership and maybe sell the whole shebang to one of the big boys before saturation or technology advance squeezes the margins. on that score AVN looks good for the next 12-18 months.

I'm looking for at least £15 by end-2011, but doubtless there will be trading opportunities along the way for those canny (or brave) enough to take them.

[backmarker] 04/1/2011 13:23

happy new year to all!

ib, the correct spelling is Slainte Mhath. I appreciated the sentiment, but accuracy is all.

my top tips for 2011 - apart from AVN - are RRR and RGM, and SVE.
RRR and RGM have already 5-bagged in 2010, but there's a lot more to come. they are related companies, with same chairman (Andrew Bell), but cover different areas of E&M: RRR = gold, uranium, plus a big stake in Jupiter Mines, RGM = nickel, copper, gold, 21% of RRR, and other stakes. each of these companies is a multi-trick pony, with excellent flow of news and other info.
SVE is an investment trust of sorts, invested predominantly in gold, metal and commodities companies (including RRR and RGM)
each of these companies has a wide spread of investments, representing significantly lower risk than the sector as a whole, but with 100%+ potential for 2011.
dyor, the BBs are excellent, with lots of useful links.

[yorgi] 04/1/2011 13:15

Blimey we have gone blue ;-)

[yorgi] 04/1/2011 12:04

When we get the RNS that Hylas1 is now in service and another contract win or two I'm quite confident we will see sentiment change and the share price rising again

[malcolmmm] 04/1/2011 11:50

volsung true but there is a potential market of 100 million so I don't think competition matters so much in that respect, I believe quality of their products and service is superior which will matter more in the long run imo

[volsung] 04/1/2011 11:28

Malcolmm they are not worth £10 at the moment. They are worth what the market will pay for them. There are issues of possible competition from other providers. Thats what's holding the price back. I think these can be resolved and in a few months they may be worth £10. I hold

[malcolmmm] 04/1/2011 11:20

These are worth £10 plus at the moment but as TW said the directors selling was a PR disaster sending out wrong messages, looks like they shot themselves in the foot for now, market confidence will take a few months to recover imo

[volsung] 04/1/2011 10:54

This has a nice wee graph. Thats why I like it

[yorgi] 04/1/2011 10:10

A Happy New Year to you Pojscott and all other AVN sharholders

[pojscott] 04/1/2011 10:09

Yorgi--your right,i am in this for the longer run and feel confident the news flow will continue to be positive. GOOD LUCK and happy new year.

[yorgi] 04/1/2011 09:55

Yes but be patient Pojscott more will come and don't forget we had a flow of good news in December

[pojscott] 04/1/2011 09:13

We now need some very positive news to move this stock up.

[ib1905] 02/1/2011 08:16

melody ta - yes i looked at ETO and wondered if i had missed the boat - don't know about AZEM so will research. Oil, gold/other metals, and some tech stuff like here and ARM (which I think still has much to give) seem to be how my holdings are panning out (no pun!)

I am now at the stage where I get excited before market opens and love the days going forward when it goes back. And I know - it can all go belly up so we all needto be vigilant - oh and I despise shorters because I buy a company and want it to be successful. I have heard a lot of 'each to their own' but prefer to profit from success rather than failure. I have nothing against balanced caution in debate.
Rant over. Happy new year again. Here's to Tuesday - I see the market is closed for the Royal Wedding - humbug.

[melody9999] 01/1/2011 17:04

IB - you got in at the right time! If you are looking at stocks with (IMV) a similar risk profile to AVN, then try ETO and AZEM - 2 of my core holdings. But I would also ensure resource stocks played a large part in my portfolio.

[someuwin] 31/12/2010 19:42

...Yes, FUM should be a massive winner in 2011 if all goes to plan.

[superg1] 31/12/2010 18:40

ib

I know I'm on filter but FUM is my top 1

[pojscott] 31/12/2010 15:11

Happy new year all.

[ib1905] 31/12/2010 13:23

And a happy new year to you all - 15 months into this lark and it is great fun and rewarding too. I have now decided at the +30% stage to sink another chunk of capital into some new stocks in the new year - I would be happy to hear people's top two if they are willing - TIA and have a great time - slangevar - (Scottish Gaelic - cheers, good health)

[superg1] 31/12/2010 08:49

At least now we know why the EBS sold a load of shares DYOR