News Operators Satellite

Yahsat achieves record Q1 revenue with 7% growth in adjusted EBITDA

Adjusted EBITDA reached $67m, marking a 7% year-on-year increase, while a double-digit reduction in normalised costs led to an expanded margin of 67%, compared to 63% in the prior year.

Yahsat has announced its consolidated financial results for the three months ending on March 31, 2024. The period witnessed a 1% revenue growth compared to the previous year, reaching a record $101m. EBITDA surged by an impressive 58% to $96m, while net income nearly doubled to $53m. However, on a normalised basis, adjusting for material, one-off items to enable like-for-like comparison, EBITDA climbed 7% to $67m, while net income dipped by 8% to $27m, reflecting the introduction of UAE corporate tax this year

The performance was underpinned by revenue growth across two key segments. The Infrastructure segment, the Group’s largest, continued to grow its year-on-year revenues by 1%, providing communications capacity to the UAE Government through an index-linked long-term contract. Managed Solutions, the second-largest segment, reported impressive revenue growth of 19% along with higher margins, primarily catering to the UAE Government and related entities. However, the Mobility Solutions segment recorded lower revenues, mainly due to fewer equipment sales, while the Data Solutions segment witnessed a decline in revenues stemming from lower subscriber numbers.

Yahsat boasts contracted future revenue of $6.7bn, equivalent to approximately 15 times last-twelve-month revenue, and only 1% lower versus the year-end 2023 figure.

The company exhibited strong cash generation, with Discretionary Free Cash Flow (“DFCF”) reaching $69m, more than double the prior year figure, driven by an improved collection of receivables.

With a historically robust balance sheet, Yahsat reports an improved cash position of $615m, negative Net Debt of $162m, and expects $1bn in new advance payments. Additionally, the company has access to a $300m undrawn bridge facility and long-term visibility of future cash flows up to 2043, positioning it well to fund growth capital expenditures, opportunistic acquisitions, and dividends.

Ali Al Hashemi, Group Chief Executive Officer of Yahsat, commented: “Yahsat has achieved another set of strong quarterly results, demonstrating further progress in growing our core business of serving the UAE Government’s requirements for satcom solutions.

“We also continue to progress toward finalising the full contract for the new $5.1bn Capacity and Managed Services Mandate with the UAE Government and the related procurement contract with the satellite manufacturer for two new satellites, Al Yah 4 and Al Yah 5. Further, we are working on completing the procurement of Thuraya 4, to be launched into space in the second half of this year, which will renew and continue Thuraya’s success story for many more years to come.

“Lastly, following the recent shareholder approval of the merger with Bayanat, we are now working toward completing the merger in the second half of the year and finalising plans for the successful integration of the two companies. This merger will usher in an exciting new chapter, positioning Space42 as an AI-powered space technology champion in the MENA region with global reach. For the first time in our industry, we will combine advanced satcom solutions and geospatial analytics, operating communication and Earth Observation satellites across multiple orbits.”