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Expects full year 2024 revenues of between $17-$19 million

REHOVOT, Israel, December 09, 2024--(BUSINESS WIRE)--SatixFy Communications Ltd. (the "Company" or "SatixFy") (NYSE American: SATX), a leader in next-generation satellite communication systems based on in-house-developed chipsets, has released its consolidated financial results as of and for the nine month period ended September 30, 2024 and provided recent operational and business updates.

Management Commentary

Nir Barkan, Chief Executive Officer of SatixFy, commented, "We are very pleased with the strong momentum we have shown in the third quarter, which has continued into the current quarter. Our recent progress has been marked by key agreements that highlight growing traction for our chipsets and strong market demand for our satellite communication solutions. Most importantly, in November 2024, we signed a milestone $39 million contract with Telesat to develop Landing Station Baseband Units for Telesat’s Lightspeed Network, solidifying our role as a critical partner to them. Additionally, our collaboration with MDA Space Ltd. continues to strengthen and we signed a number of further agreements with them in October 2024, including a software development and license contract supporting their digital payload systems and new agreements expanding our collaboration on space-grade chips. We believe this further strengthens our market-leadership position in space-grade chipsets for the upcoming generation of communication satellites. Our growing momentum demonstrates the strategic value of our cutting-edge technology to our customers and we believe our success will translate into improved financial metrics over the coming quarters."

Guidance for 2024

During the fourth quarter of 2024, the Company signed a number of key agreements and expects to meet certain milestones which will result in a significantly increased level of service revenues in the fourth quarter. As such, the Company currently expects to report full year 2024 revenues of between $17 and $19 million with a gross margin of between 70% and 75%.

Financial Highlights for the Nine Months of 2024

• Total revenues for the nine-month period ended September 30, 2024, were $8.5 million, a decrease of 4% compared to $8.9 million in the same period in 2023. The majority of revenues for the current nine-month period were from product sales, driven by the commencement of shipments of engineering samples of space-grade Application Specific Integrated Circuits ("ASICs"). It is noted that over the nine-month period there was a decrease in revenues from development services and preproduction provided to customers due to the completion of various development services agreements as well as the above-mentioned higher level of product sales compared to the same period in 2023.

• Gross profit for the nine-month period ended September 30, 2024 was $6.2 million (gross margin of 72%), a 36% increase compared to $4.5 million (gross margin of 51%) in the same period in 2023. The increase in gross profit and gross margin was due to the Company’s product mix favoring higher-margin space-grade ASIC products.

• Operating loss for the nine-month period ended September 30, 2024 was $23.1 million, an 18% improvement compared to an operating loss of $28.1 million during the same period in 2023. The decrease was mainly attributed to a higher gross profit and a reduction in operating expenses, as described below.

• Expenses Breakdown:

  • Research and Development expenses, net ("R&D"), for the nine-month period ended September 30, 2024 were $21.4 million, a 15% decrease compared to $25.1 million in the same period in 2023. R&D expenses were primarily driven by the Company’s significant efforts to develop its space-grade ASICs and bring them to maturity. The decrease in R&D expenditure was driven by a decrease in salaries and related costs combined with a decrease in post-silicon costs related to ASICs.

  • Selling and Marketing expenses for the nine-month period ended September 30, 2024 were $2.1 million, a 13% increase compared to $1.8 million for the same period in 2023. The increase was primarily due to an increase in payroll and related costs.

  • General and Administrative expenses for the nine-month period ended September 30, 2024 were $5.7 million, a 2% increase compared to $5.6 million for the same period in 2023.

  • Finance expenses: $11.5 million, a 64% decrease compared to $31.8 million for the same period in 2023. The decrease was primarily due to a $24 million revaluation expense of the Company’s derivatives in 2023.

• Net loss for the nine-month period ended September 30, 2024, was $34.5 million, or $0.41 per basic and diluted share, a 43% improvement compared with a net loss of $60.0 million, or $0.74 per basic and diluted share, in the same period in 2023, which included the large derivative revaluation expense as noted above.

• Cash and Cash Equivalents as of September 30, 2024, amounted to $6.5 million, compared to $14.0 million as of December 31, 2023.