Avanti Communications Share Discussion Threads

[peterblok] 18/7/2014 17:04

I'm out of these Guys. Taken a big loss, but these are now too iffy for me.

GLA

PB

[mjcferguson] 18/7/2014 16:42

I am very encouraged by the sales momentum.The hit to profit before tax is largely refinancing costs from which the Company will benefit going forward and set up costs for substantial new contracts ,again from which the benefit will now flow.Market has overreacted ,price will pick up again once sales momentum news sinks in.

[hpcg] 18/7/2014 11:44

I think the reaction is about right. Cursing myself for not reacting to the chart at 280p in June. The revenue is intriguing. One financing and depreciation are covered then additional revenue largely drops to the shareholder account. I'll buy the chart if momentum indicators flash. I'm expecting a consolidation at this level though, in itself pretty necessary.

[jeffian] 18/7/2014 09:49

Well I don't think buywell needs to lose too much sleep over it. After all, we could always send up Bruce Willis and his team of miners to......

[chriscallen] 18/7/2014 09:32

That's a good question! Almost all of the reported damage appears to be to satellites in Low and Medium Earth Orbits, which is what you might expect as this is the area with a lot of junk. Even a small bit (

[sidam] 18/7/2014 09:28

jojaken

My thoughts are that EBITDA could/will also be $14m (2 times $7m financing) lower than projected. EBITDA is profit/loss plus interest, depreciation and amortisation. Those should not have changed by much.

But at this stage in the companies development, revenues are the KEY and the annualised rate is now $100m plus a bit if Q4 were $25.5m or middle of range.

That looks more like a J curve to me and an indication that the run rate could be near the $230m plus level originally projected at June 2016 by Jeffries when they wrote a note for the original bond financing.

So the shares could be extremely good value especially with HYLAS 4 scheduled for 2017. That is a BIG satellite.. Time will tell, but I am holding for that.

[jeffian] 18/7/2014 08:52

#371,

Does anyone know the last time a commercial satellite was taken out by a meteorite?

TIA.

[mjcferguson] 18/7/2014 08:35

Sales of 25m dollars in q4 is big leap from 14m in q3.Assuming on going growth sales in first half 14/15 will be double last six months with corresponding cash-flow.

[jojaken] 18/7/2014 08:23

Buywell I get the impression you are disappointed too. Just you were hoping these results would be much worse than they are!

Looking at what limited info they have offered in this report, the standout is the growth in revenue, not the profits I'm afraid.

I'm actually quite sanguine about the report day, because this could be the first real evidence of traction in the business. If they can really grow revenues 60% half year on half then todays profit disappointment will be forgotten very soon!

As you might have guessed I'm NOT selling this morning.

[julcester] 18/7/2014 08:18

They will be insured against that.

[buywell2] 18/7/2014 08:12

Besides the debt issues

Just one hit to any one of their SATS by space junk or small meteorite and the whole company will crash and burn

Not factored in at all by the pink specs brigade

[buywell2] 18/7/2014 08:10

Whilst you might be happy

The market clearly is not



chriscallen 18 Jul'14 - 07:59 - 367 of 369 0 0

The provision for financing costs is estimated at $7m on a total raised of $157.5m i.e. just under 4.5%. I'm happy enough that they write off set up costs

[count chris] 18/7/2014 08:06

Fully funded would have sounded better than well funded I have to say. But if the revenues there then they are selling and not 'giving it away' as the shorters claim and the quality of the customer base shows they are doing a top job technically.

[chriscallen] 18/7/2014 08:03

PS I don't think sales of $65M for the year translates to £20m even with the $ at its current levels. The market isn't buying Avanti for what it is now but what it should be in 2-3 years and that depends on getting the sales in at good margins.

[chriscallen] 18/7/2014 07:59

The provision for financing costs is estimated at $7m on a total raised of $157.5m i.e. just under 4.5%. I'm happy enough that they write off set up costs for large new projects as some of us can remember what happened to Rolls Royce when they capitalised the costs of the RB211 engine - i's much more prudent to write off the costs when they arise. The bit I don't particularly like is the reference to year end provisions but it depends on who and how much and we won't know that until the accounts are published.

Looking on the bright side sales revenues are well up with this quarter equalling what was done in the first half year and 78% up on the March quarter. The cash was $130m better than the balance at 30/03/2014 so the sales are feeding through to the bottom line cash generation.

[jojaken] 18/7/2014 07:53

I wrote a week or so ago that revenue of $40m would actually beat most forecasts, anyway to quote from my range of forecasts,

"High-end forecast (on revenue)

$40m (equates to 62% growth on $25m in H1)

Where I'm shooting for, but I'm forever an optimist. Revenue this high would definately surprise most and finally meet in-house broker Jefferies' perpetually disappointed expectations. It would also justify David Putting-on-a-brave-face Williams' comments after Q3, "Our momentum is picking up and growth is starting to look more like a J-curve than a straight line." Anything around the $40m mark will surprise the market as Avanti has consistently dissapointed the market on the revenue side so this would be a first! "

BUT, . . . Well they still managed to surprise the market with missed profits!

Although having delayed and delayed the announcement until Friday, well I think most realised by now something was amiss!

Two initial thoughts though,

1. Not happy about lack of detail in the statement.
2. Most had realised financing was going to be larger than initially thought, but does lower than expected profit also mean EBITDA will be negative?

Still not as bad as I was fearing given the delays and the slide in the share price!

[buywell2] 18/7/2014 07:38

Cos they ain't done so well







''However, PBT will be lower than consensus with approximately half of the variance resulting from bond refinancing costs of $7m and the balance attributed to exchange rate changes, year end provisioning and set up costs on large new projects.''


buywell2 13 Jun'14 - 06:31 - 342 of 361 0 1 edit

10% finance sounds twice as much as it should have been

Debt will be a big problem for this going forwards

Mkt Cap £315m on a turnover of £20m and loss making looks a recipe for disaster

[megabear] 18/7/2014 07:32

"Year end provisioning"? Anyone know what that could relate to?
Surely the bond refinancing costs would have been understood and in consensus?

This is an awful statement. Thought with the recent director buying would've been on the up.

[buywell2] 18/7/2014 07:13

''However, PBT will be lower than consensus with approximately half of the variance resulting from bond refinancing costs of $7m and the balance attributed to exchange rate changes, year end provisioning and set up costs on large new projects.''


buywell2 13 Jun'14 - 06:31 - 342 of 361 0 1 edit

10% finance sounds twice as much as it should have been

Debt will be a big problem for this going forwards

Mkt Cap £315m on a turnover of £20m and loss making looks a recipe for disaster

[someuwin] 18/7/2014 07:09

Profit warning.

[wilksey11] 17/7/2014 16:18

UK tech companies deliver e-learning to Kenya's marginalised girls from avn web site this afternoon

[nugacity] 16/7/2014 11:24

"The new satellites expand the company's reach across Asia, Africa, South America, Australia and the Middle East."
"O3b is also looking to play a big role in the maritime and energy sectors."
---------------------------------------------------------

Add a few oceans and it is pretty much the whole world less Europe and North America? Spreading their satellites a bit thin maybe?

Our beams are targeting specific zones which sounds more promising for customers in those areas.

Once broadband is universal, it is inconceivable that one company will supply everyone so plenty of cake to share out yet :O)

[sg31] 15/7/2014 10:40

The competition has 8 satellites, 4 of which are defective and 4 just launched and untested.
No doubt the will obtain loads of business when they get their act together but KA band is new technology that will change the industry. AVN are a small niche player, there should be plenty of business to go round without serious price pressure.
If AVN can't make a go of it they will get taken over. They have satellites in position and would be a good start for anyone wanting a presence in the market.

[jadeticl3] 15/7/2014 10:25

Has this competition won many contracts that AVN hoped to win?

[beauf] 15/7/2014 10:06

The competition has 8 satellites.