Thaicom CEO Patompob (Nile) Suwansiri. Photo: Thaicom

Thaicom saw a fall in its net profits and overall revenues in 2022. The company reported its financial results the week of Feb. 15. In 2022, the company had a net profit of 42 million baht ($1.24 million), an over 70% decrease compared to 2021. However, while its net profits were down, its core profits saw an increase which could be a pointer to better days ahead. External factors such currency valuations and satellite issues were given as the reasons why there was such as disparity between the net profit figure and the core profit figure.

Revenues for 2022 reached 2.9 billion baht ($85.6 million), a decrease of over 11% compared to the same stage last year.

Patompob (Nile) Suwansiri, CEO of Thaicom, told Via Satellite, “Thaicom is in the process of turning around and our core profits increased ten-fold compared to the previous year. Moving forward, we are on a growth trajectory with the new satellite program as well as expanding into the space tech domain. We are very confident of the future demand for broadband satellites especially in the Southeast Asian and South Asian regions.”

“In the short term, the biggest challenge to is maximize revenues with the existing satellite fleet we have although this will change in the medium term as we bring in more satellites into our fleet and leverage the growth coming from markets in the region that we currently provide and have strong partnerships and landing rights,” he added.

Thaicom’s board of directors approved for Space Tech Innovation Company Limited (STI), a wholly-owned subsidiary, to invest in the satellites for the orbital slot at 119.5 degrees East. It is part of an ambitious plan that Thaicom calls the “Satellite Project.” It will see a total investment of 15.2 billion baht ($448.6 million). The costs of the project will comprise of license fees for orbital slots at 119.5 degrees East, 120 degrees East, and 78.5 degrees, as well as the construction of three satellites at 119.5 degrees East. The construction of the satellites for the orbital slot of 119.5 degrees East has been targeted to be completed before the end of life of the Thaicom 4 satellite.

On the back of this, Thaicom’s board of directors has approved STI to invest in the construction of the satellites for the orbital slot of 119.5 degrees East before others. As to the 78.5 degrees East orbital slot, within three years after acquiring the orbital slot, STI would need to launch a satellite into 78.5 degrees East orbit in order to maintain the complete operating rights, allowing Thaicom to have some additional time to consider an investment in the satellite project at the orbital slot of 78.5 degrees East.

“The investment in the Satellite Project is a strategically important business decision. This ensures that Thaicom can keep serving its domestic and international clientele and continue to earn their trust. Thaicom can also maintain the current customer base on the orbital slot 119.5 degrees East. In addition, it would strengthen investors’ confidence and create additional value and benefits for Thaicom’s shareholders over the long term,” the company said in a press release.

Prasit Sujiravorakul, a satellite equity analyst at Bualuang Securities said in a research note that Thaicom’s numbers were “significantly below its estimates.” He added, “Gross profit and after-tax profit undershot our model by 21% and 87%, respectively. Sales dropped 7% year-on-year and 3% quarter-on-quarter, largely due to the drop in satellite usage by foreign broadband clients (given that the Ipstar satellite is approaching its useful life expiry in 2024). By geography, revenue from Thailand rose 3% year-on-year, but that from Australia, India, Japan dropped 2% year-on-year, 25% year-on-year and 52% year-on-year, respectively. The satellite revenue was 736 million baht ($21.45 million), down 7% year-on-year.