Orbital Sciences Corporation has not written off the Intelsat Galaxy-15 spacecraft and is working to restore operational control by the summer, according to company President and chief operating officer JR Thompson.
Speaking at Orbital’s Q1 investor…
Orbital Sciences Corporation has not written off the Intelsat Galaxy-15 spacecraft and is working to restore operational control by the summer, according to company President and chief operating officer JR Thompson.
Speaking at Orbital’s Q1 investor conference call, Thompson stated that the company is hard at work transferring customers off the satellite to its replacement, the Orbital-built Galaxy 12 spacecraft, while it continues to troubleshoot the problem on Galaxy 15, which has left it unresponsive to uplink commands and caused problems with downlink telemetry.
“We expect this work to continue for between three and six weeks, with the goal of restoring Galaxy 15 to full operational status by this summer,” he said.
“While we cannot guarantee that this work will be successful, Orbital has occasionally confronted similar situations in the past in which full satellite capabilities have been restored.”
Orbital CEO Dave Thompson said that the company’s best informed guess as to the cause of the Galaxy 15 anomaly was a heavy period of solar activity that took place between April 3 and April 5. Records show that the satellite’s malfunction occurred immediately after the peak of the solar storm.
“On the scale that space weather experts use that is somewhat comparable to the Richter scale for earthquakes, this was a seven magnitude solar storm event,” he said. “I think the largest on that scale, that has ever been encountered is an eight-point-something, so this was the most severe event that we have experienced in the last four or five years.”
No other Orbital satellites were apparently affected by the solar storm. Thompson said that the company will take additional preventative actions to provide a safety net in the event of a similar event ever occurring on other Galaxy satellites, but stated he was comfortable that this will not happen.
Orbital plots new share buyback following steady results
Orbital’s Board of Directors has authorised a US$50m share repurchase program over a 12-month period. This will replace the company’s previous stock buyback plan for the same sum, which expired on March 6.
Orbital initiated its share repurchase program in 2004. Since then, it has purchased 12,772,038 shares for a total of US$207,339,898.
Reacquisition of stock is one of Orbital’s three main areas of capital deployment, alongside internal investments in product development and possible future acquisitions.
Orbital recorded steady first quarter results that saw little deviation in year-on-year revenue, generating US$296.2m compared to US$295.7m in Q1 2009. Net income was US$9.3m, slightly up on US$9.2m for the same period last year.
The company has raised its guidance for 2010, taking into account the integration of General Dynamics’ satellite business, which was acquired for US$55m in April. The new revenue guidance is US$1.225-US$1.275bn, US$50m up from the previous figure of US$1.175 – US$1.225bn.
The US$55m GDAIS acquisition has also impacted on Orbital’s anticipated free cash flow, which is reflected in the reduction in its guidance to US$60-70m from US$75m-85m.
CEO Thompson said that it was a period in terms of new business, with the company winning just over US$250m in new orders and existing option exercises in the first quarter. However, he expects to see a substantial pickup in new business bookings and option exercises in Q2 and Q3 based on proposals currently outstanding and other new business pursuits with the potential value of US$1.3bn.
