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Yahsat bags $5.1bn contract from UAE government

Yahsat's contracted future revenue now rises to AED25.7 billion, over 16 times its 2022 annual revenues Wam
Yahsat's contracted future revenue now rises to AED25.7 billion, over 16 times its 2022 annual revenues

Al Yah Satellite Communications Company (Yahsat) has won an AED18.7 billion ($5.1 billion) contract from the UAE government to provide satellite capacity and managed services for 17 years.

The contract, for its government services arm, Yahsat Government Solutions, includes related operations, maintenance and technology management services of ground segment satellite systems and terminals currently provided under a separate contract, the Abu Dhabi-listed company said in a statement on Friday.

The deal replaces two current agreements – capacity services agreement and managed services mandate – which end in November and December 2026, respectively.

Under the new contract, Yahsat will provide the government with secure and reliable satellite capacity and related managed services using the Al Yah 1 and Al Yah 2 satellites, currently in orbit.

The services will be supplemented by two new satellites, Al Yah 4 and Al Yah 5, which are expected to be launched in 2027 and 2028, respectively.

The group’s contracted future revenue now rises to AED25.7 billion, over 16 times its 2022 annual revenues, extending backlog well beyond 2040.

In addition, the award includes an advance payment from the government of $1 billion in 2024.

Group CEO Ali Al Hashemi said: “Our financial position has never been stronger. We remain optimistic about providing a broader, more diverse and cutting-edge solutions portfolio to both the government and our customers.”

Yahsat signed an authorisation to proceed with US-based Airbus in June 2023 to construct AY4 and AY5.

The AY4 and AY5 procurement, including spacecraft, ground segment infrastructure, launch and insurance, will be funded by Yahsat’s own resources and other potential funding options, which are currently under review.

Yahsat reported a net profit of AED175 million for the first half of 2023 on revenue of AED753 million.

Its fleet of five satellites reaches more than 80 percent of the world’s population, enabling broadband, broadcasting, backhauling and mobility solutions.

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