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Technology Stocks : Loral Space & Communications -- Ignore unavailable to you. Want to Upgrade?

To: Valueman who wrote (2055)	2/26/1998 2:02:00 PM
From: Valueman	Read Replies (1) \| Respond to of 10852

There have been a number of posts about the relative values of Loral and G. Excluding the value of G, the rest of the parts of Loral are valued at 14/share or roughly $4 billion. For that money, what do we get: Skynet--2 GEOs, 2 to launch in 98, 2 more in 99--each is capable of generating $100 million+ in revenues with 85% EBITDA margins Orion--Orion 1 is up and at a 90% utilization, Orion 3 launches late 98, Orion2 in mid 99. Very aggressive management doing exciting work on internet via satellite, lining up a slew of business in internet traffic both in Europe and Asia. Asian business is already starting using leased transponders. Recent report on 97 revenues totalled $72 million. That number will almost double in 98 according to Loral's own estimates. Orion's satellites are perfectly capable of generating $200 million in revenues each, with EBITDA margins eventually approaching 60%. 49% of SatMex--Three more GEOs over North and South America. Morelos III to belaunched late 98 to provide a modern high power platform. Estimates for 97 have $113 million in revenue, $85 million in EBITDA. G* Management Fees--Remember that Loral gets 80% of 2.5% times the first $500 million in gross revenues. and 3.5% after that. This is not included in the G* value we subtract from Loral's price. Europe*Star--awaiting details, but first sat will have 32(?) Ku-band transponders and possibly others, generating another $100 million plus. No word on timing though. Cyberstar--begins operation soon using a single transponder on Telsatr5. If things go as projected and they generate $460 million in EBITDA in 2002, you have a division with a value over $4 billion. SS/L--The manufacturing arm from which all good things come. Low margin, but a key part of the "master plan." Providing very useful cash flow at the moment. Worth at least $5 per share. Invaluable in the big picture. Others--CD radio stake, Agila II transponders(Fortune article mentions that Indonesian sat phone biz leases Loral transponders--these are only Asian transponders they have),ABCN stake, Phillipine DTH, India DTH, Rural telephony via GEO, and I am sure I am forgetting something else. If these all don't add up to something worth a present value of $4 billion, I am doing something wrong!