AVANTI:
LOOKING UP

A letter from the CEO – Reflecting on my two years at Avanti

Following a period of change and progress, 2020 has continued to deliver many positives, despite it not being quite the year we were expecting. I’ve been very impressed by how everyone in our organisation has risen to the challenge of keeping people connected throughout the COVID-19 pandemic, be it with each other, or with our clients and professional contacts.

Undoubtedly, the fact that Avanti now has a very clear ambition – to be the leading EMEA Ka-band satellite capacity partner to the communications industry – has helped keep focus and momentum over recent months. In extending and guaranteeing coverage for defence missions, enterprise solutions, and critical public services we have won key contracts and achieved a doubling of our bandwidth revenues in 2019. Now we are aiming high, driving long-term revenues through a focus on the defence, industry and carrier sectors.

Never before has satellite connectivity played such a vital role in guaranteeing secure and reliable communication for government bodies, first aid responders and health organisations. For our part, we are working hard to provide resilient and secure satellite connectivity.

At the same time, we have firmly kept an eye on ensuring we continue to build a resilient balance sheet and generate increased profit. Over the past two years we have reduced capacity unit costs by two-thirds and developed a lean operating model, which has helped operations remain robust throughout this period.

We have also spent time carefully building a professional organisation. Our executive committee is now packed with talented people who bring broad industry experience. They are supported by a focused and driven team who work tirelessly to make sure Avanti continues to thrive.

Now, as we continue through 2020, we strive to build relationships further and grow our coverage capability to connect the unconnected.

Kind regards,

Kyle Whitehill
Chief Executive Officer,
Avanti Communications

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We are a completely transformed business

We are a dedicated partner to the communications industry

In the last two years, we have refocussed our business away from consumer broadband to wholesale, government and carrier segments.  As we enter the second half of 2020, Avanti is a completely transformed, resilient and future-proof business. 

The core of our business model is formed around uncompromised customer service quality, agile adaptation to dynamic market conditions, and superior experience through highly secure and reliable connectivity.

Libby Barr
Chief Operation Officer

This transformation is leading to significant growth and here are the highlights:

Satellite Industry

We have secured major wholesale bandwidth contracts with Viasat, Inmarsat, Turksat and Yahsat.

Terrestrial Communications Industry

We have signed a new service agreement with a large African Carrier to provide cellular backhaul across Africa using our HYLAS 4 satellite’s fixed capacity. We continue to provide a resilient backhaul service to EE and the Home Office for emergency services in the UK.

Government

Government We are growing our revenues from the US Department of Defence – the single largest buyer of commercial satellite capacity in the world – and the European Ministry Of Defence market through important service agreements with regional partners. This is leading to a significant pipeline of opportunities for 2020 and beyond.

Master Distributor

We continue to partner strategically with five large master distributors across EMEA.

Our financial results are going from strength to strength

2019 was a year of achievement for Avanti. As a result of our new market strategy, we achieved dramatic growth by more than doubling our bandwidth revenues.

We established a cost optimisation programme at the end of 2018 which has driven a reduction in our operating cost base in excess of 25%. This was achieved by aligning the business’ cost base with our strategy to sell to a relatively small number of large, well-funded customers and tightly controlling our spend. 

By achieving both of those objectives we delivered positive EBITDA (before restructuring costs) for the first time in the Company’s history. The operating leverage of the Avanti business is such that our forecast growth in bandwidth revenue and reduction in our operating cost base will continue to drive increased EBITDA and cash generation.

Rob Plews
Chief Financial Officer

We have a unique set of strategic assets that differentiates us

Our satellite capacity has trebled in the last two years; we now operate a fleet of 5 satellites with 50GHz of Ka-band capacity. They are positioned in coveted, prime orbital positions, secured by Avanti at the level of the International Telecommunications Union.

Along with our fleet of satellites, we also own a fully authorised, resilient and secure ground network of 7 Gateway Earth Stations supporting our customers. In 2019, we were the first company to have stations and full authorisations in South Africa and Nigeria. Covid-19 is driving a permanent need for connectivity outside of the urban environment and a push to ensure equal access to communications, everywhere for everyone. Avanti has been at the forefront of advocacy at the World Radio Conference to keep precious spectrum to support this ambition.

In December 2019, Avanti’s HYLAS 3 satellite capability arrived on station at 31E and became operational as the world’s first Ka-band steerable cluster of high throughput spot beams. 

Clean spectrum and unencumbered orbital slots are the strategic underpinning for a successful satellite business. In the last two years, we have significantly strengthened our position in that respect, adding to the trust users can place in the quality of our services as well as in the long term future of the business. In addition, we have now fully government approved market access, giving carriers, governments and users unparalleled market access and commercial reach over our network. To support our key business segments, our focus firmly includes the validation of satellite to support 5G and to integrate satellite and terrestrial technologies. To this end, Avanti’s ambitions extend to leading a significant 5G innovation project, with support of the UK government and the European Space Agency that will culminate in demonstrations and test-beds throughout the EMEA region.

Ann Vandenbroucke
Chief Regulatory Officer

We empower people and strengthen communities

Our ‘Be More’ mantra runs through our DNA and we fully support the United Nations Global Goals by taking a stand and doing our part to make a difference.

Sitting alongside names such as Coca-Cola, Diageo, Google, Mastercard, Microsoft and more, Avanti is one of the 17 Business Avengers who have joined forces in 2019 to help achieve the Goals by 2030. Avanti is responsible for Quality Education – in reflection of our wider commitment to improve education across Africa.

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We are geared to grow in these turbulent times

COVID-19: We have gone above and beyond for our employees

What we have learnt, specifically during the first 12 weeks of the pandemic, is that we need to look at the individual. No two circumstances are the same; a ‘one-size’ fits all approach doesn’t work.

We chose not to change policy but to flex week by week to make sure we did the best for our people in ever-changing circumstances.

We have introduced a range of initiatives, including collective and individual on-going update, work balance measures and innovative employee engagement.

Debbie Mavis
Group HR Director

COVID-19: We have proven our resilience and capability to maintain high standards

As the world seeks to stay connected from behind closed doors, satellite connectivity is playing an important role in guaranteeing secure and reliable communication for government bodies, first aid responders and health organisations.

During these few challenging months, we have shown fantastic business continuity implementation. We have guaranteed critical connectivity enabling businesses, governments and schools to continue to operate and families and friends to remain connected.

We have put everything in place to guarantee a seamless transition to full remote working whilst maintaining service excellence, ensuring existing business and remain revenues largely unaffected.

How we’ve supported Niger’s government response to COVID-19

Using HYLAS 4 capacity, Avanti has provided resilient and secure satellite connectivity and equipment to 10 government sites across Niger, keeping lines of communication open for key government bodies. We are collaborating with the national Agency of Information Society (ANSI), the technical arm of the government of Niger responsible for coordinating ICT solutions in the Covid-19 response in Niger.

We’ve been able to help other companies remain resilient through this time only because we’ve been resilient ourselves. Despite the unprecedented scale and duration of this challenge, we were well set to weather the tests that COVID-19 has thrown our way as a business that is used to working through a networked system, across nine dierent geographies. Within days our business was able to continue operating at full capacity, almost entirely remotely, which meant we enabled our customers to keep people connected right across EMEA.

Looking to the future, as we proceed with a technology refresh and the augmentation of our existing satellite fleet, we are leveraging the miniaturisation that is taking place in satellite manufacturing, through software defined radios and electronic propulsion systems, as well as shorter technology cycles and lower launch costs. The resulting small and nimble GEO satellites we add to our fleet will maximise the agility and flexibility of the services we oer and will open up new business opportunities for our customers.

Scott Richardson
Chief Technology Officer

We are professional, capable and committed to good corporate governance

Over the past two years Avanti has transformed its leadership, and enhanced and engaged talented teams who deliver services to our customers. In 2019 Avanti Communications de-listed from the UK Alternative Investment Market. Whilst this could have led to some relaxation of our Corporate Governance protocols, we chose to review and enhance them. 

We believe that our customers, partners, employees, shareholders, suppliers and society at large benefit from the professional, considered and ethically-minded running of our Company.

Bridget Sheldon-Hill
General Counsel and
Group Company Secretary

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We are well positioned to accelerate in the years ahead

Many have highlighted the impact Covid-19 has had, and will continue to have, on the economy as a whole and on individual businesses across the globe. We have taken the time to refresh our market strategy and key areas of focus, as well as defining what “back to the abnormal” means for us and have determined that Avanti is in a unique position to continue driving revenue throughout this period and accelerate growth in the future. We have also focused on how we can deliver the promises we make to our customers in an efficient and effective way. 

Toby Robinson
Chief Strategy and Wholesale Officer

Here is our response to a rapidly changing and uncertain future:

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