Al Yah Satellite Communications, better known as Yahsat, said first-quarter net income jumped by more than 26 per cent as revenue received a boost from the strong performance of all its business segments.
Net profit attributable to shareholders in the three-month period to the end of March was Dh74 million ($20m), the company said on Wednesday in a regulatory filing to the Abu Dhabi Securities Exchange, where its shares are traded.
Adjusted earnings before interest, taxes, depreciation and amortisation (Ebitda) climbed by about 7 per cent a year to Dh213.4m, generating a 58.9 per cent Ebitda margin.
Revenue for the reporting period climbed more than 9 per cent to Dh362.5m, driven primarily by the company's managed solutions and mobility solutions businesses.
The group’s contracted future revenue stood at Dh8.1 billion, about 5.4 times the company's annualised revenue.
Future revenue increased 8.6 per cent in the first three months of this year and by more than 47.3 per cent since the beginning of 2021.
“Yahsat has had an excellent start to 2022,” said group chief executive Ali Al Hashemi.
“With almost 90 per cent of remaining projected revenue for the current year already secured, we remain very confident in our outlook for Yahsat and reiterate our guidance for financial year 2022.”
In February, Yahsat Government Solutions was awarded a mandate worth Dh908.9m to provide enhanced managed services to the UAE government for its satellite communications capabilities.
The five-year deal reinforced Yahsat's position as the government's preferred satellite solutions partner and allowed the company to strengthen its “foundations for long-term sustainable growth”, Mr Al Hashemi said.
Yahsat group’s net debt stood at more Dh382.1m at the end of the first quarter.
Together with discretionary free cash flow of Dh333.1m and a cash conversion ratio of about 98 per cent, the group is “well positioned to meet its future dividend, growth and capital expenditure commitments”, it said.
Founded in 2007, Yahsat operates in more than 150 countries across five continents. Its five satellites reach more than two thirds of the world’s population.
In October, Yahsat was appointed by the UAE government to conduct a detailed assessment of two new planned satellite launches by 2026, a move that would help it “further bolster its contracted future revenues and secure its longer-term financial outlook”, the company said at the time.
One of the major projects that Yahsat is working on is the Thuraya 4 Next Generation satellite (T4-NGS, which is scheduled for launch next year.
The satellite is expected to commence offering commercial services in the second half of 2024.
Overall, about 85 per cent of Yahsat's Dh698m projected capital expenditure and investments in 2022 is expected to relate to the T4-NGS programme.
This will be fully funded by existing debt facilities and an advance payment of Dh551m in June 2022 by the customer, the company said.
In April, Yahsat's shareholders approved the company's updated dividend policy that allows the payment of semi-annual payouts going forward.
For the 2022 financial year, the company is expected to pay a total dividend of Dh393.3m, or 16.12 fils per share, split into two equal instalments that will be paid around October this year and in April 2023.
“Yahsat reiterates its commitment to grow its dividend by at least 2 per cent per year, reflecting the board of directors’ confidence in the financial strength of the business,” it said on Wednesday.