Seanet: 2009 a turnaround?
2009-05-27 14:16, Edited at: 2011-03-11 05:46Please note: Community posts are written by its members and not by Redeye’s research department. As a reader you’re always encouraged to critically analyze the content.
2009 will be the year for a turn around and with that a start of healthy finances within the company. The pdf can be found here: http://www.maestrogarcia.se/
SeaNet Background
SeaNet Maritime Communications AB (publ) traded on the NASDAQ OMX First North, is a global mobile telecommunication operator and technology provider that provides telecommunication at sea.
SeaNet main target customers are shipping companies and its main offering is roaming at sea.
Roaming is when you travel to a foreign country and your mobile phone keeps working.
Headquarter is in Solna, Stockholm and the company has 12 employees.
CEO is Klas Lundgren who has 12 years of experience from marketing and sales at Ericsson
Customers, Market and Competitors
Customers:
SeaNet target customers are shipping companies, ship-owners and offshore, oil rigs. The shipping customer segments are cruise liners, ferries, merchant vessels and super yachts.
SeaNet has 28 contracts with around 20 in service; amongst them are Moby Lines, World Cruises Agency and Baleria.
Areas of operation of these ships are mainly Mediterranean Sea, Baltic Sea and the Caribbean Sea.
SeaNet has today ~170 roaming deals with existing mobile operators to secure that mobile phones are working on a “SeaNet ship”.
Merchant vessels are waiting in line to get such a service, a competitor made during last year 600 ship installations. The majority of ship crew members are from South East Asia (e.g. 9 million Philippines) and they want to be in contact with family relatives.
Market: The market is easiest divided into seasonal and non-seasonal periods.
The seasonal cruise liners and ferries have peak season April –September l
while
merchant vessels, private yachts, offshore, oil rigs, military/government have no seasonal variations.
Competitors: There are 3 major competitors, Maritime Communications Partners AS in Norway and owned by Telenor AS, Sea Mobile, Inc. in USA owned by AT&T and On Waves Ehf, in Iceland and owned by SIMINN (formerly known as Iceland Telecom).
Business and operation
SeaNet went live during March 2009 with its new telecom supplier, Ericsson! The Ericsson co-operation and its GSM platform brings following advantages:
- 99,99% availability – compared to last year where the old system was down to 50% availability
- Smarter voice codec – decreases the satellite link cost with 50% - less capacity used
- Project financed – monthly payment from H2 2010
- Maintain and operation – handled by Ericsson
Next step was to re-evaluate the satellite link provider and change the business model to a leasing agreement, which do not require any capital investments.
SeaNet has today
171 settled roaming agreements and with its new carrier, Belgacom, it’s both easier and faster to launch new roaming deals.
The positive currency situation of being a Swedish company and making business outside Sweden gives an extra add-on:
-> Costs/Investments are made in SEK and sales comes outside Sweden in €uro.
SeaNet has partnered up with a prepaid provider, to save the costs of investing in a new expensive system and to be able to offer that service to tourist and/or crew members.
Finance and Summary
Finance:
In 2008, SeaNet had 5 ships on average in service during July, August and September with an average income of $40,000/month.
This year, SeaNet has the full peak season ships in service, April – September! The ships in service will be an average around 20!
From Q2-Q3 2010, monthly payments (~400.000SEK/month) will be made to Ericsson.
Market cap is around 15MSEK compared to expected revenue of at least € 1,000,000 for 2009
Summary: When you enter a “SeaNet ship”, you will get a Welcome SMS, you will see signs, brochure’s and onboard TV advertisements
and the network will be up and running 24hrs.
SeaNet is today the
only turn-key provider of maritime telecom systems, so that shipping companies can focus on their core business instead of handling a telecom network.
2009 will be the year for a turn around and with that a start of healthy finances within the company.
The question is if not a big telecom operator will take the opportunity to grab this market via acquisition, and why not SeaNet?
The full analysis in pdf can be found here: