LONDON (Alliance News) - Avanti Communications Group PLC on Tuesday reported a narrowed pretax loss in its last financial year, but revenue fell as it failed to make sales in one of its business areas.
The satellite operator said its pretax loss in the year ended June 30 narrowed to USD67.0 million from USD73.3 million the year before, as revenue decreased to USD82.8 million from USD85.2 million.
Revenue from capacity, services and equipment grew by almost a quarter, but this was offset by it not making any revenue from spectrum co-ordination in the year. In the prior year, revenue from spectrum co-ordination totalled USD25.1 million.
Avanti's pretax loss narrowed, however, thanks to GBP13.9 million received in finance income. No finance income was recorded in the prior year.
Avanti added that it expects to generate a constant currency continuing business growth rate of at least 35% in the medium term, against a base of the last financial year's total revenue of USD82.8 million.
Constant currency continuing business growth rate is a measure which refers to revenue for the year, excluding any large, infrequently occurring items with non-USD components of revenue, calculated at the most recent foreign exchange rate.
In a separate statement, Avanti said it made revenue of USD18.0 million in the first quarter of its new financial year, while making a loss before interest, tax, depreciation and amortisation of USD5.0 million.
Earlier on Tuesday, Avanti said it has completed its strategic review and launched a proposed refinancing of USD242 million.
Avanti said its review of the business, which began in July, has led it to terminate the formal sale process it had announced in September, when it had said it was in discussions over the potential sale of the company.
Instead, Avanti on Tuesday said it has launched a proposed refinancing which will fully fund the company through the creation of USD242 million of additional liquidity. Of this, USD130 million will come from new cash funding in the form of PIK toggle notes, a type of bond, and USD112 million from potential interest deferrals up to April 2018. Avanti said this will allow it significant working capital to launch its HYLAS 4 satellite and grow its capital structure.
According to Avanti, it has received agreement of holders representing 73% of its senior secured notes due in 2019 to fully underwrite the USD130 million of new cash funding and to consent to certain amendments and waivers to permit the interest deferral.
"Securing the underwriting of core bond investors to launch this major refinancing gives us a high degree of confidence that it will complete in January. After a turbulent year for Avanti, it is important for us to focus all of our attention on delivering outstanding services to our customers and preparing for the launch of HYLAS 4," Chairman Paul Walsh said in a statement.
"This prized asset will more than double the revenue generating capacity of the fleet, bringing much needed extra capacity to mature markets in Western Europe and opening exciting new markets in West Africa," he added.
Shares in Avanti were trading up 9.5% at 23.00 pence on Tuesday.
By Karolina Kaminska; karolinakaminska@alliancenews.com; @KarolinaAllNews
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