Yahsat's first-quarter net profit jumps 35% on strong business performance

Company's revenue during three-month period reached Dh369 million

Yahsat offers multi-mission satellite services in more than 150 countries across Europe, the Middle East, Africa, South America, Asia and Australasia. Photo: Yahsat

Al Yah Satellite Communications, better known as Yahsat, recorded a nearly 35 per cent surge in its first-quarter net profit on the back of a strong performance in its managed solutions segment.

Net profit attributable to the shareholders of the company in the three months to the end of March climbed to Dh27 million ($7.35 million), from Dh20 million in the same period last year, the company said on Monday in a filing to the Abu Dhabi Securities Exchange, where its shares are traded.

Yahsat’s revenue during the three-month period grew to Dh369 million, up nearly 2 per cent from about Dh99 million in the first quarter of 2022, driven by strong growth in managed solutions, infrastructure and data solutions businesses, Yahsat said.

It added that this was “record” quarterly revenue for the company.

“Yahsat had a strong start to the year with continued focus on growing both our core government business and commercial segments, whilst optimising costs across the group,” said Ali Al Hashemi, group chief executive of Yahsat.

“The upcoming Thuraya-4 NGS satellite, due to be launched in 2024, followed by two potential new satellites, Al Yah 4 and Al Yah 5, reinforce this direction and present unique growth opportunities.”

Yahsat is aiming for more than 5 per cent revenue growth in 2023, driven by a strong performance in managed solutions and more diversified revenue streams from new lines of business, its chief financial officer Andrew Cole had told The National in March.

The company expects revenue of between $435 million and $455 million and adjusted earnings before interest, taxes, depreciation and amortisation (Ebitda) of between $240 million and $260 million this year, he said at the time.

Founded in 2007, the subsidiary of Mubadala Investment Company offers multi-mission satellite services in more than 150 countries across Europe, the Middle East, Africa, South America, Asia and Australasia.

Yahsat’s managed solutions business involves providing satellite communication services to the UAE government, with about 85 per cent of the company’s revenue coming from the UAE market.

The group in the first quarter of 2023 reported a revenue increase of 29 per cent year-on-year from managed solutions to Dh72 million, it said.

Infrastructure, the group’s largest business segment, continued to deliver stable and predictable returns, with Dh220 million in revenue reported during the January to March period, up 1 per cent from the prior year period.

With a strong balance sheet supported by a cash surplus of more than $500 million, Yahsat plans to further increase investments in its commercial lines of business, it said in March.

In its commercial businesses, the company is refocusing on areas of higher growth and profitability, it said at the time.

This includes industry segments such as oil and gas, health and education, and maritime, and offering both mobile and fixed satellite services to meet satellite connectivity needs.

New products under development for the Thuraya-4 NGS satellite will also be offered to commercial customers, it added.

Yahsat is “working to progress previously announced initiatives with local and international partners targeting areas including satellite-enabled Internet of Things, vertical value-chain integration, satellite direct-to-device and earth observation”, said Mr Al Hashemi.

“The satellite industry is witnessing substantial investments as exciting new products and applications are brought to the market whilst the largest satellite operators consolidate to confront the transforming, competitive landscape.

“A robust balance sheet place us in a strong position to drive our future ambitions and continue delivering sustainable, long-term growth.”

Yahsat said it was on track to grow its full-year 2023 dividend by “at least 2 per cent to 16.46 fils per share, or Dh402 million, based on the last closing share price … implying an annualised dividend yield of more than 6 per cent”.

The company has five satellites that extend its reach to more than 80 per cent of the world’s population, enabling critical communications such as broadband connectivity, broadcasting and mobility solutions.