NSR assessed a target satellite operators business case to help support the client investment decision

The problem

• The client requested a detailed risk analysis on a satellite operator business case that examined the credibility of the level of service demand and price projections for satellite capacity to be sold in the business plan
• This would form the basis for an investment decision on financing a new satellite asset; it would also identify other key drivers for revenue and opex, with a high level of granularity in terms of the number of terminals and customers on different verticals and use rate per satellite, among others

The solution

• NSR provided a critical analysis of the capex and opex used in the business case and determined whether opex budgets had been achieved
• It then presented a cashflow sensitivity analysis reflecting a highly unfavourable market scenario in the event of:
  • a drop in demand
  • a low-demand scenario
  • deviation from the relevant drivers identified by NSR
• Finally, NSR provided an assessment on competition among geostationary and non-geostationary players serving satellite operator regional targets
  • specifically, NSR examined the impact on pricing in the next ten years and the impact of this on a new satellite business case

Figure: Project scope and methodology

The result

NSR produced a detailed report with recommendations for the target satellite operator; the report validated the investment the client was planning to make on the next-generation satellite; NSR also delivered a dynamic model with inputs that can be altered by the client to show varying assumptions and produce multiple scenario-based results