concentration of sources
Halal Communications, which provides satellite communication services through the Amos 1 and Amos 2 satellites, recently signed long-term contracts for the distribution of TV channels totaling one million dollars. Chall will provide the services via the Amos 2 satellite to companies in Russia and Lithuania that operate local TV channels.
David Polak, CEO of Halal Communications, said that the company intends to expand its operations in these and other markets. Chall currently provides similar services to other countries in Eastern and Central Europe such as Ukraine, Romania, Hungary, Slovenia, Croatia and Bosnia.
According to him, the company continues to consistently increase the occupancy rates on the Amos 2 satellite which stood at 2005% at the end of December 75.6. The long-term order backlog of Halal Communications is $372 million. Halal Communications earned NIS 5 million on a turnover of NIS 41 million in the fourth quarter of 2005. This compares to a loss of NIS 7.5 million on a turnover of NIS 44 million in the third quarter of this year. The equity capital of Chalal Communication is NIS 105 million and the company's market value is NIS 295 million after an 18% decrease in the last 12 months.
Space Communication provides satellite communication services. The company controlled by Eurocom, Mr. Industries, the Aerospace Industry, and the group of founders (22% each) markets satellite segments of the Amos 1 satellite for the Aerospace Industry. The company also owns the Amos 2 satellite, which was launched in December 2003 and began commercial operations in April 2004.
Chalel Communications, which trades at a value of NIS 290 million, ended 2005 with a loss of NIS 8 million due to heavy financing expenses. The financing expenses resulted from the devaluation of the shekel against the dollar, which had a negative effect and increased the dollar liabilities that financed the purchase of the Amos 2 satellite.
However, it is worth noting that the company's dollar report actually indicates a profit of NIS 25 million and that the company generated a surplus of NIS 77 million in cash flow from current operations.
The space also had an EBITDA of NIS 128 million in 2005. That is, Chall is currently trading according to an EBITDA multiplier of 2.2. The use of the EBITDA figure is very relevant regarding space because of the nature of its activity - large investments at the beginning, and a revenue stream that covers them later. Chall is expected to launch the Amos 2007 satellite by the end of 3, which will help its growth.
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