Avanti adopted new accounting methods for its fiscal year ending June 30 and said that future revenue would be more weighted towards the later stages of contracts than previously expected. The operator no longer recognizes all of the revenue for contracts immediately, even if all the cash is collected at the beginning of the contract.

   “We now recognize this revenue over the course of a contract,” Avanti CEO David Williams said in a statement. “The decision was made to adopt more conservative accounting treatments for certain transactions we made during the year.”  

   Avanti’s order backlog increased 57 percent over the same period year to 268 million British pounds ($429.8 million). Williams, however, noted that the phasing of Avanti’s backlog was more back-ended than the company expected.

   “The customers that are agreeing multi-year contracts are being cautious about taking large amounts of bandwidth in the early stages of these contracts,” said Williams.

   The report prompted an anxious response from analysts and investors. Avanti shares fell by 16 percent Oct. 10 after analysts lowered their 2013 revenue forecasts for the operator by as much as 30 percent. Stockbroker firm Cenkos lowered its 2013 and 2014 revenue forecasts for Avanti by approximately 40 percent.

   Avanti Chairman John Brackenbury tried to calm investors during a conference call, stating that the operator’s losses are nowhere near as wide as its future prospects.

   “This has been a year of very strong growth for Avanti. The momentum of launching our second satellite in as many years to expand coverage to a total of 53 countries has created very significant demand,” Brackenbury said. “This is now evidenced in our contract backlog, which grew by 57 percent in the year. Within the emerging markets that Avanti serves, our flexible and resilient technology is winning business from customers who urgently need reliable, high-quality communications.”

   Avanti’s Hylas broadband satellites provide service to customers in Europe, the Middle East and Africa that cannot access terrestrial broadband infrastructure. 

   Earlier this week, the operator announced that its Ka-band satellite Hylas 2 entered full operations and had begun providing data and video service coverage. Hylas 2 carries 24 active Ka-band user beams and six gateway beams providing two-way communications services to facilitate high-speed delivery of data to end-user applications such as corporate networking, IP Trunking, cellular backhaul, broadband Internet access, business continuity services and video distribution.

   “The formal launch of service on Hylas 2 over Africa and the Middle East gives us access to markets showing high economic and structural growth in demand for telecoms services,” said Brackenbury. “We look forward to the continued development of Avanti with growing confidence.”

   Hylas 2, along with Hylas 3 due in 2015, aim to increase international capacity by 25 percent by bringing an additional 100 Gigabits of capacity to Africa.

   “Satellite broadband is a proven enabler for business growth. Governments and NGOs will be able to deliver public services such as education and healthcare to wider populations at lower cost, and industry and commerce located away from fixed line infrastructure, such as agriculture and mining, will also benefit,” said Williams.