Intelsat

Performance indicators

2020: Revenue decline to $1.91 billion, loss to $909.3 million

Intelsat's revenue at the end of 2020 amounted to $1.91 billion against $2.06 billion a year earlier. The company remained unprofitable: net losses reached $909.3 million, slightly reduced compared to the monetary losses of a year ago in $913.6 million.

Due to the COVID-19 pandemic, 2020 turned out to be a difficult year, says Intelsat CEO Stephen Spengler, commenting on the company's financial results. - Nevertheless, the strategic value of our global network and services based on it has remained unchanged throughout the year. Our mobile customers were affected by the reduction in transportation in both the maritime and aviation sectors, but they renewed contracts and committed to new orders. In addition to current trends, business in the broadcasting sector was also affected by weakening currencies and a reduction in revenue from irregular orders, which is largely due to the coronavirus.

From the reporting of Intelsat it also follows that the company's revenues from network services in 2020 decreased by 12% compared to 2019 and amounted to $677.4 million. This direction accounted for 35% of revenue. The decline here in the company was associated with the consequences of the pandemic, a decrease in demand from customers and one-time revenues in 2019.

The company's revenues from the broadcasting direction also decreased - by 8%, to $812.5 million, which is due to the non-renewal of contracts with a number of customers, as well as a reduction in signal transmission orders due to the cancellation of sports events and concerts caused by the pandemic.

Revenue from state customers at the end of 2020 was equal to $392.6 million, an increase of 4% compared to the previous year. The upswing came at the expense of new businesses including FlexGround services and satellite communications services.^[1]

History

2024

Loss of satellite

On October 19, 2024, Intelsat reported that its main geostationary satellite Intelsat 33e had failed and had fallen apart. Because of this, thousands of subscribers in Europe, Africa and parts of the Asia-Pacific region were left without TV and Internet. Read more here.

SES bought Intelsat for $3.1 billion

Intelsat, a satellite operator in bankruptcy, sold for $3.1 billion to Luxembourg-based SES. This deal was announced at the end of April 2024.

2022: David Weisgras is Intelsat's new CEO

In early March 2022, Intelsat's board of directors appointed former Raytheon top manager David Weisgras as the company's new CEO. He will lead the satellite operator after the bankruptcy. Read more here.

2020

A lawyer from Moscow received 4 years for a scam with a membership fee of the USSR in Intelsat

In Moscow, a verdict was passed on international lawyer Yakov Melnikov in the case of a scam with a Soviet international contribution. He was found guilty of fraud on an especially large scale.

Melnikov found out that in the deposit account of the Ministry of Finance of the Netherlands there are more than €819 thousand, which are due to Russia. The money was contributed in 1991 to the Ministry of Communications as a membership fee upon joining the Intelsat International Satellite Consortium on the basis of a resolution of the USSR Cabinet of Ministers. The Ministry of Finance successfully forgot about this, and the lawyer learned the information on one of the Internet forums from representatives of the Dutch financial company.

 In 2012-2013 , the lawyer used the services of this company and submitted a package of forged documents to the Ministry of Finance of the Netherlands. It followed from them that the debt was assigned to him. The consortium had by then gone bankrupt, and Melnikov received the money. The amount stolen amounted to more than 33 million rubles.

A criminal case against Melnikov was initiated based on the materials of the FSB. As part of the investigation, Melnikov's money, real estate and car were seized for a total amount of more than 13 million rubles and more than $317 thousand. The court sentenced Melnikov to 4 years in a general regime colony.

Filing for Bankruptcy

On May 13, 2020, the largest satellite operator Intelsat, whose constellation includes 50 satellites, announced the filing of bankruptcy in accordance with Chapter 11 of the US Bankruptcy Code, which provides for the reorganization of companies in a difficult situation. Earlier, in March 2020, a similar step was taken by the OneWeb operator.

The company itself calls its bankruptcy "financial restructuring" and compares it with similar measures taken in the past by GM and American Airlines.

The process is aimed at increasing the company's liquidity. We expect that it will lead to a significant decrease in our debt burden (which as of May 2020 is $14.5 billion), the operator said in a statement.

Satellite operator Intelsat filed for bankruptcy following OneWeb

Intelsat plans to continue operating as before without reducing staff. In this, she will be helped by financing the debtor in possession (new loans received after the start of the bankruptcy procedure) in the amount of $1 billion, which the company managed to agree on, but did not have time to receive - whether these funds will reach it will now be decided by the court.

One of the main reasons why Intelsat decided to restructure the business right now is the operator's desire to take part in freeing up the frequency band that the US Federal Communications Commission plans to give for the construction of 5G networks.

If Intelsat does this on time, it will receive the right to financial support from the state in the amount of $4.87 billion. However, to free up frequencies, the company needs to spend more than $1 billion, which it does not have.

In addition, the activities of the company, a significant part of the revenue of which was formed through the provision of communication services on aircraft and ships, were affected by the COVID-19 pandemic.^[2]

Notes