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NewSat posts profit, revenue growth

Satellite company NewSat (ASX:NWT) said its FY11 profit grew to $300k, and its revenue to nearly $29m, due to new business wins

Satellite company NewSat (ASX:NWT) has reported a $300,000 profit for FY11, from 15 per cent higher revenue of $28.8 million.

The bottom-line result was an improvement on the slim $26,000 profit in FY10, and the $2.9 million loss in FY09.

Growth was aided by the signing of 175 enterprise contracts during the period, each with an average value of around $70,000 per year, NewSat said.

As a result of the business wins, the company's recurring revenue stream is now around $2.6 million per month. Gross margins meanwhile improved 9 per cent over the year to reach a total of $12.9 million.

The company also made progress on its Jabiru geostationary satellite project, including completing the technical design phase and securing the orbital slots required for its planned Jabiru-1 and Jabiru-2 crafts.

The signing of major capacity supply deals including the $US114 million agreement with TrustComm also progressed funding for the project.

CEO Adrian Ballintine said that the “Jabiru satellite program is [now] on the verge of delivering spectacular future growth.”

But spending on growth including the Jabiru project led to operating cash flow falling 58 per cent to $907,000. NewSat's financial report states that “management continues to review operating costs and overheads and closely assess all areas of the business".

NWT shares stayed flat on Thursday at $0.007.

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