LONDON (Alliance News) - Avanti Communications Group PLC Monday said its performance in the year to end-June demonstrated it was capable of meeting its long-term target of over USD700 million in annual revenue, as it posted a widened loss for the year.
Avanti said it is building a business that could potentially generate more than USD500 million in earnings on USD700 million revenue once its current fleet of satellites is fully in place. Although it warned that this "will not happen overnight", it said that its achievements in the year show it "is capable of achieving this ambitious growth in time".
The satellite operator posted a pretax loss of USD87.7 million, widened from USD58.9 million in the previous year, despite revenue rising to USD65.6 million from USD32.1 million, as cost of sales jumped up and the company posted a higher finance expense.
Revenue included certain non-recurring projects, alongside new business wins with international telecoms and media companies. However, set up charges and the full-year expense of operating two ground stations for its HYLAS 2 satellite drove up costs.
Avanti signed 92 new contracts during the year. Average pricing for coverage via the company's satellites remained above its target rate of USD2,000 megahertz per month, it said.
The company said that it expects its susceptibility to one-off set up costs and its dependence on a small number of large contracts to diminish.
Avanti expects to see revenues in the first quarter of the new year at around the average level for the previous year, with new contracts driving growth in subsequent quarters.
Shares in Avanti were trading up 3.7% at 190.00 pence Monday morning.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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