Monday, September 24, 2018

With Stock Prices Rising, A New Board, New CEO and Secured Funding, UrtheCast Might Be Moving Forward

          By Chuck Black

Vancouver BC based UrtheCast is moving quickly to make up for lost time and (hopefully) remind the country that the private sector can also fund and execute complex space focused projects.

According to the January 3rd, 2018 Cantech Letter post, "Urthecast has 264% upside, Clarus Securities says," the stock market was betting big on UrtheCast. But in March 2018, its stock fell through the floor, loosing almost half its value on March 8th (from $0.98 CDN to $0.55CDN) and slowly dropping under $0.30 CDN per share over the next several months. As outlined in the June 26th, 2018 post, "UrtheCast Shareholders Endorse the New Board," the new board and CEO, ex-MDA president Don Osborne, are hoping to generate a turn around, or at least some signs of life, before the next financial reporting period, sometime this fall. Graphic c/o UrtheCast.

As outlined in the September 20th, 2018 UrtheCast press release, "UrtheCast Announces the Signing of New US$25M Contract for UrtheDaily Constellation," UrtheCast:
...has signed a binding contract for $25Mln US ($32.5Mln CDN) to provide data from the Company's planned UrtheDaily™ Constellation to a long-established commercial Earth observation operator and value-added services provider on the Indian subcontinent. The contract will provide UrtheCast US$5Mln ($6.5Mln CDN) annually over the first five years of UrtheDaily™ operations...
This latest contract, when added to revenue acquired from the acquisition of the North Vancouver BC based Geosys Technology in August 2018, is expected to bring UrtheCast's total contracted revenue backlog to over $300Mln CDN, according to the press release.

And, while $300Mln doesn't compare to the billions of dollars of backlog commonly reported by large telecom companies like Ottawa ON based Telesat or Westminster CO based Maxar Technologies, its a good start.

As outlined in the August 2nd, 2018 Ottawa Business Journal post, "Ottawa-based Telesat adds new contracts amid disappointing Q2," Telesat reported a $3.8Bln CDN backlog for its most recent quarter. As outlined in the July 31st, 2018 Maxar press release, "Maxar Technologies reports second quarter 2018 results, declares quarterly dividend," Maxar reported a backlog of $3.05Bln US ($3.95Mln CDN) as of June 30th, 2018.

Revenue backlog is the value of contracted revenue that has yet to be recognized. Its a useful measurement of the future strength of a company.

The three revenue generation windows for Urthecast as per the January 9th, 2018 Seeking Alpha post, "UrtheCast: 3 Steps Forward, 2 Steps Back," which stated that "UrtheCast has steadily improved its business stability throughout its corporate history," and praised the 2015 UrtheCast purchase of Boecillo Spain based Deimos Imaging. As outlined on the UrtheCast website, the UrtheDaily Constellation is a planned "global coverage constellation aiming to acquire high-quality, multispectral imagery, at 5-m GSD, taken at the same time, from the same altitude every day." As outlined on Gunter's Space page listing for Urthedaily, the constellation, "planned for launch in 2020, will be capable of scientific-grade quality, multispectral imagery, high-resolution, targeted specifically at geoanalytics applications. The satellites have a 5 m ground resolution with a 360 km swath width." Graphic c/o Seeking Alpha.

In anticipation of the new order, UrtheCast stock on the Toronto Stock Exchange (TSE) rose substantially last week.

As outlined in the September 22nd, 2018 Press Oracle post, "UrtheCast (UR) Shares Up 43.8%," UrtheCast stock prices:
...shot up 43.8% during trading on Thursday (September 20th). The company traded as high as 0.23 CDN and last traded at $0.23 CDN. 
523,490 shares traded hands during mid-day trading, an increase of 20% from the average session volume of 436,979 shares. The stock had previously closed at $0.16 CDN...
The stock price eventually settled down at $0.20 CDN per share, up from $0.16 CDN, where it currently seems to be hovering.

As outlined in the June 26th, 2018  post, "UrtheCast Shareholders Endorse the New Board," the company has recently approved a new board and a new CEO. The appointments were considered by the broader investment community to be "a vote of confidence" on UrtheCast's future prospects, according to sources.

The next formal quarterly investor report is expected in November.
Chuck Black.

Chuck Black is the editor of the Commercial Space blog.

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