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NWT - Newsat Limited

The expected launch of Jabiru (on a French Ariana rocket) seems to have attracted some anticipatory buying.
The chart pattern suggests a bottom could be in place with lift-off proper to be sparked when resistance at 39c is overcome.



Some of my money is already on a successful launch.
 

Just read an article on NWT today and thought I'd re-work my earlier calculations and see how things looked 2 years on.

http://www.sharecafe.com.au/cafetake.asp?a=AV&ai=29897


So let's work with $200m EBITDA every year for 15 years. What's the NPV for such a project? Looks like cash flow won't start until 2015/2016. Debt is $500m so interest say @ 3.5% ($390m of the debt from US Ex-Im Bank @ only 3%) = $17.5m p.a. Assuming linear D&A over 15 years and tax of 28.5%, I get steady state cashflow of ~$140m per year for 15 years starting in 2015. Discounting at 12% gives a NPV of $860m. Now they presumably need to pay back the $500m in debt, so the NPV is ~$360m. Depending on debt repayment profile (they may pay the debt back earlier), this number could go up to $390m.

Today there's 612m shares on issue so the value of the Jabiru-1 is ~58-63c per share. This however assumes no value on the existing buisness (which made a loss in the latest half), over 60% capacity in use, and that management returns the cashflow to investors (or invest it to generate return > discount rate). The choice of 12% discount rate may or may not be appropriate given there's still construction, launch and sales risks, but there seems to be enough margin in NPV terms over current share price of 30c on offer.
 
Re: NWT - Newsat smacked down today. Any news?

Any idea what's up with NWT today? Trending a +20% decline.
 
These business very similar to airlines, high cost, high maintenance low return and your local telco can always price you out
 
There has to be more to this move than a few reports of old news, it's been well telegraphed that there has been management movements before June 30 per the ASX announcements. Also a director has been piling into the stock like no tomorrow based on other ASX announcements.

I have seen this fall from 48c (my first buy) to mid 25's and was quite stable. But today's drop seems to have come from nowhere. Has there been talk of another delay in the launch date for their satellite?



PS> Junior - I couldn't see that Eureka report as it asked for a log in - still waiting for admin to grant me access.
 
A Green beacon in a sea of Red?
I'm accumulating at these levels - let's break the trend line

 

Well... RIP NWT.

No amount of analysis can trump bad corporate governance... and that should always be a risk factor in any thorough due diligence.

http://www.theage.com.au/business/newsat-and-bob-hawke-the-satellite-spruiker-20150417-1mmz55.html

For the record, I actually bought some at 30c back in June last year. The position was only small to ensure me a chance to participate in any capital raising. I sold the stock @ 20.5c on 1 Aug 2014 when the problems first appeared (which they disclosed in a speeding ticket response). A big loss percentage wise but it was less than 0.5% damage to the overall portfolio.
 
I was always amazed how Adrian Ballantine managed to keep this company going by paying in shares. Always felt precarious to me so did not own any but it is a sad day for Australia.
I remember Anthony Horseman loving this company when asf was new.
I think Ballantine did a good job really but a big backer was needed.
 
This business model failed regardless of management, you can have a superb management but this business will still failed eventually ... Understand the business model and you never ever lose money in this sort of business.

Bad management just accelerate its demise
 
An interesting postscript to the Newsat saga courtesy of ASIC.

Former Newsat CEO Adrian Maxwell Ballintine and Melbourne accountant Jason Dermot Cullen to stand trial over the making of invoices that were false or misleading contrary to section 1308(2) of the Corporations Act that allegedly caused Newsat to make payments of $357,000 and $275,000 to private companies associated with Mr. Ballintine and Mr. Cullen.

https://asic.gov.au/about-asic/medi...o-of-newsat-limited-committed-to-stand-trial/
https://asic.gov.au/about-asic/medi...elbourne-accountant-committed-to-stand-trial/
 
Pathetic. Took that many years to get a slap on the wrist?

Used to follow newsat years ago. I have a negative investment interest in small companies that take on big projects. The projects are a usually goer but the company usually goes broke or is recapitalised as the capital required often exceeds the original estimates. NWT was clearly on that trajectory - and then throw in all the drama with Luxury Yachts, trips, etc. etc.
 
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