Tuesday, January 24, 2017

Elon Musk, Donald Trump, The Globe & Mail, MDA, exactEarth & NASA Admins Bolden & Newman, Who Say Buh Bye

          By Henry Stewart

For the week of January 23rd, 2017, here are some of the items we're currently tracking for the Commercial Space blog:

  • It's odd to consider SpaceX and Tesla CEO Elon Musk as a guest of US president Donald Trump at the White House on the first day of the new administration. The two are generally perceived  to have diametrically opposed worldviews.  
But, as outlined in the January 23rd, 2017 Business Insider post, "Elon Musk and other executives are at the White House to meet with President Trump," that's exactly the situation the two seems to have found themselves in. 
According to the article, Musk is one of "several executives attending President Donald Trump's meeting on manufacturing Monday morning. Reuters' reporter Roberta Rampton snapped a shot of Musk in the White House's Roosevelt Room, along with executives from Lockheed Martin, Whirlpool, Under Armour, and Johnson & Johnson."
And, "although Musk and Trump have diametrically opposing views when it comes to climate change, the two seem to be aligned when it comes to US manufacturing."
This is the third meeting between the entrepreneur and the incoming US president over the last few weeks. Trump said on Monday morning that he would cut regulations by 75% to encourage businesses to manufacture their products in the US, though it's unclear if he was referring to the number of regulations or their cost.
  • Back in Canada, it's normally a bit unusual for the "paper of record," to promote publicly traded stocks, but that certainly seems to be the situation with the January 22nd, 2017 Globe and Mail post, "Analysts think now is a good time to buy MDA," which tracked some of the recent ups and downs at Richmond, BC based MacDonald Dettwiler (MDA).
Fortunately, the article proper is certainly more ambiguous than the title would suggest. 
It's primary thesis is that, "investors hoping a new American chief executive officer at MacDonald, Dettwiler and Associates Ltd. would help boost the shares of the satellite technology firm may have to be patient this year."
Reasons given include "a weaker communications satellite market" and delays in receiving the necessary US security clearances, which are needed to allow MDA to bid on larger Defense Advanced Research Projects Agency (DARPA) and US military satellite contracts.
The Globe piece also noted that US based CEO Howard Lance, "declined to be interviewed for this article."
But the article did reference a variety of other analysts, including Raymond James analyst Steven Li, who categorized classified US government business as incremental revenue which "won’t likely contribute meaningfully until 2018 at the earliest.”
I think some of the issues will resolve themselves,” over the next year or so, said BMO Nesbitt Burns analyst Thanos Moschopoulos, who has an “outperform” rating on MDA stock, and an $83 CDN target for the next 12 to 18 months.
  • Cambridge, Ontario based exactEarth Ltd. has posted a Q4 loss on lower overall sales. As outlined in the January 19th, 2017 Waterloo Region Record post, "Cambridge-based ExactEarth post $4.1M Q4 loss on lower sales," the loss was attributed to "a reduction in revenue from a contract with the federal government." 
That contract was originally outlined in the February 14th, 2016 post, "Newborn exactEarth Faces its First Battle for the Worm," and revisited in the May 7th, 2016 post, "Orbcomm, Skywave, exactEarth, CSA Rovers, High School Robotics, MDA, Emerson, Magellan, Honeywell & UrtheCast," 
As outlined in those earlier posts, what had begun in February as a simple renewal of an existing exactEarth Federal government contract worth $19Mln CDN, had shrunk in value to only $116,000 CDN by May 2016. 
Of course, as outlined in the January 19th, 2017 exactEarth press release, "exactEarth Reports Fiscal 2016 Financial Results," waiting for government contracts hasn't been the only revenue generating activity the company has engaged in since it was spun off by parent COM DEV International in January 2016. 
2016 operational highlights include the development of partnerships with Chinese based EV Image Inc. (to distribute exactEarth data in China), Ottawa based Larus Technologies (to develop new "Big Data" analytics applications for the maritime market) and Colorado based DigitalGlobe (to combat "illegal and unreported fishing"), plus expanded collaboration in a variety of areas with Louisville, Kentucky based Genscape
The year also included the signing of a new four year contract with the French Navy and a "small-vessel tracking contract" with the Government of Ghana. 
2016 financial highlights include $18.9Mln CDN in new revenue (with 80% being subscription based, a 30% increase over 2015), an increase in order booking to $27.2Mln CDN (up from $10.0Mln CDN in 2015) and an adjusted EBITDA of $0.52Mln CDN with a cash balance of $13.7Mln CDN as of October 31th, 2016.
Outgoing deputy administrator Newman with outgoing administrator Bolden and incoming acting administrator Lightfoot at a NASA "town hall meeting" on January 12th, 2017. Photo c/o NASA/Bill Ingalls.
As outlined in the January 12th, 2017 Space Policy Online post, "Lightfoot to be Acting NASA Administrator, CFO Radzanowski to Stay On - UPDATE," Bolden and Newman, as political appointees representing the outgoing Barack Obama administration, ended their tenures at noon on January 20th, 2017, when president Obama formally finished out his term and was replaced by incoming US president Donald Trump
The new administration is moving slowly to replace the open NASA positions. 
As outlined in the January 22nd, 2017 Space News Post, "Trump administration assigns first political appointees to NASA," NASA Associate Administrator Robert Lightfoot has taken over as acting NASA administrator, at least for the short term. 
The Trump administration has also appointed Erik Noble, a Trump campaign political data analyst (who also spent seven years at NASA's Goddard Institute of Space Studies) to serve as White House senior adviser and Greg Autry, an assistant professor of entrepreneurship at the University of Southern California (who is considered a proponent of commercial space activities) as White House liaison.
For more, check out upcoming posts in the Commercial Space blog.

Henry Stewart is the pseudonym of a Toronto based aerospace writer.

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