In-Flight Entertainment (IFE) and connectivity company, Gogo, is being hurt by the dramatic reduction in passengers on aircraft which is the backbone of its business — the company is laying off 143 full-time positions in their Commercial Aviation division and cutting salaries for all senior staff, including the CEO.
Gogo confirmed it is looking to sell its Commercial Aviation (CA) division.
“While Covid-19 has significantly impaired global commercial aviation travel and our results for the second quarter, we are encouraged by the strong recovery in business aviation as well as the beginnings of a recovery in global commercial aviation which has continued into August,” said Oakleigh Thorne, Gogo’s President/CEO. “Going forward, we are focused on maintaining the strength of our franchise and realizing the value of CA through a potential sale of the division.”
Gogo has appointed bankers to advise on the sale of the division.
CA, in North America, saw revenues plummet by 72 percent to $30 million (y-o-y) and not helped by the impact of the virus on North American air travel and, to a lesser extent, to the full impact of American Airlines switching to the airline-directed model and the de-installation of Gogo equipment from certain American Airlines aircraft during 2018 and the first half of 2019, said Gogo.
CA over the rest of the world saw revenues fall 67 percent to just $12 million (y-o-y).
The firm’s Business Aviation (BA) division also suffered, but not as much. Total revenue decreased to $54.6 million, down 23 percent from Q2 2019, driven by declines in both service and equipment revenue caused by the negative impact of Covid-19.
The overall impact saw consolidated revenues of $96 million, a decline of 55 percent and hurt by the loss of passengers on both domestic and international air travel. Gogo said, “BA reportable segment profit of $27.2 million with nearly 50 per cent segment profit margin.”
Also being reported is that Thaicom has turned a Q1 net loss into a net profit for Q2; however, revenues continue to suffer from the economic downturn.
The shift in fortunes was largely down to compensation income and offsetting losses from foreign exchange, the company said. Cutting out these exceptionals and Thaicom’s profit was just Baht 2 million (€0.05 million).
The company’s net profit for Q2/2020 was Baht 498 million, significantly improved from the net loss of Baht 135 million for Q2/2019 and Baht 198 million for Q1/2020.
Thaicom reported revenue from sales and services for Q2/2020 of Baht 873 million, down by 28 percent and 9.5 percent from Q2/2019 and Q1/2020, respectively, mainly as a result of a decrease of customer demand for broadband satellite services, along with customer churn from the Thaicom 5 satellite de-orbit.
The overall use rate for Thaicom 6, Thaicom 7, and Thaicom 8 as at the end of Q2/2020 was 63 percent, down from 65 percent as at the end of Q1/2020. For broadband satellite, on Thaicom 4, the utilization rate was 19 percent, decreased from 21 percent as at the end Q1/2020, mainly due to the drop of bandwidth consumption from overseas customers.
Satellite and terrestrial network operator Intelsat has been selected to continue distributing content for ViacomCBS Networks International (VCNI) in Central Europe, Eastern Europe and across the Asia Pacific region.
VCNI delivers premium content through notable brands such as BET, MTV and Nickelodeon to a worldwide audience of billions across both traditional and emerging platforms.
In the Central and Eastern European market, VCNI harnesses the extensive reach of Intelsat’s direct-to-home (DTH) platform on the 1 West video neighborhood to deliver its premium programming. The Intelsat 1 West neighborhood can reach more than 17.8 million viewers across the region.
In Southeast Asia, VCNI leverages the Intelsat 19 (IS-19) satellite to serve its distribution affiliates, including cable headends, throughout the region. The IS-19 video neighborhood can reach up to 70 million viewers in Asia Pacific.
VCNI will also continue to use Intelsat’s terrestrial uplink services to distribute its video content across key Asian and Central and Eastern European markets, including remote and hard-to-reach areas.
“We are proud to once again be selected as the partner of choice by ViacomCBS Networks International in distributing their premium content,” declared Intelsat Regional Vice President of North America Tim Schermerhorn.
News stories authored by journalist Chris Forrester,
who posts for the Advanced Television infosite
and is a Senior Contributor for Satnews Publishers.