Dubai: The Abu Dhabi satellite company Yahsat’s nine-month net income dropped 19 per cent to Dh128.45 million from Dh157.8 million a year ago. But revenues were up 11 per cent to Dh1.2 billion as Yahsat benefitted from the many government contracts on its books and from recent initiatives in mobile communications.
The contracted future revenue totals Dh7.6 billion [$2.1 billion], and ‘equivalent to more than 5 times annual revenue for the full year 2021’, Yahsat said in a statement. It added that it is sitting on a ‘robust financial position’ with negative net debt and a ‘high visibility on future cash flows underpins ability to invest in growth and sustain attractive dividend policy’.
Yahsat will be paying a minimum of Dh393 million as 2022 dividend, with half of it already reaching shareholders.
A potential procurement of two satellites - Al Yah 4 and Al Yah 5 - is under consideration for launches in 2026, which will 'secure continuity of service well beyond the lifetime of our existing fleet', the company said in a statement.
Yahsat is in a strong financial position with a robust balance sheet and a large and visible backlog of contracted future revenues, providing it with the capacity to invest and pursue future growth opportunities
Net income dip
As for the drop in net income, it relates to a non-cash impairment of Dh149 million from the JV in HPE Brazil. Yahsat owns a 20 per cent non-controlling stake in the entity. “This reflected a rapid deterioration in the global macro-economic environment, which significantly increased the discount rate used in assessing the recoverable amount of this investment,” Yahsat said in the statement.
Stripping this off and only the 'normalised net income' was used, Yahsat’s nine-month 2022 tally would have been Dh278 million. (A normalised net income refers to stripping out impact from non-recurring items to better understand a company's ongoing net income.)
“Yahsat delivered another excellent performance with third quarter revenue and EBITDA growth accelerating compared to the first-half of 2022," said Ali Al Hashemi, Group CEO. "Our core government business has performed particularly well with quarterly revenues in our managed solutions business more than doubling year-on-year.
"Through the procurement of the T4-NGS satellite - which we expect to launch in the first-half of 2024 and enter operations in the first-half of 2025 - we remain well positioned to meet the UAE Government’s increasing demand for advanced satellite communication solutions. T4-NGS will also strongly support our commercial operations in mobility solutions, which achieved double-digit revenue growth during the first nine months of the year."