The all-powerful: Tech companies conquer space: This is how investors with Musk and Bezos take off | message
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by Alexandra Jegers, Euro am Sonntag
A.It all began with a political power struggle: in October 1957, the Soviet Union successfully sent a missile into orbit for the first time in human history. The US was appalled. If the Soviets dominated space, would they be able to bring the US to its knees with nuclear weapons? The then US President Dwight D. Eisenhower responded by founding the space agency NASA and for his part launched a satellite into orbit. The superpower race culminated on July 21, 1969 when Neil Armstrong became the first person to walk on the moon. In total, the Apollo missions transported twelve more astronauts to the moon.
Almost 70 years after the first moon landing, the fascination of space is back. This time it is not primarily states or state organizations that are fighting for supremacy in space, but private companies. The focus is primarily on three names that actually made their money in other industries: Tesla boss Elon Musk dreams of a colony on Mars and wants to send the first spaceship on its journey with his space company SpaceX as early as 2024.
His opponent, Amazon founder Jeff Bezos, on the other hand, recently announced that he wanted to step down as board member of the online retailer in order to devote himself to other projects – above all to the space company Blue Origin, which he founded. Bezos company aims to outsource heavy industry and power generation into space. The Amazon founder sees this as the key to keeping the earth habitable.
Number 3 is British entrepreneur Richard Branson. In 2019, the self-made billionaire brought his space company Virgin Galactic to the stock exchange. One day, Branson wants to offer tourist trips into space, and buyers can reserve a seat in one of Virgin Galactic’s suborbital planes for US $ 250,000. Branson claims to have already sold more than 8,000 tickets. Other companies want to establish themselves as suppliers to the state space organizations. NASA, for example, relies on service modules from the aircraft manufacturer Airbus for the manned US spacecraft “Orion”. Boeing has also been working successfully with NASA for years.
All about satellites
Space travel has advanced to a multi-billion dollar business. Analysts at the US bank Morgan Stanley currently estimate the annual turnover of the space economy at around 350 billion US dollars, by 2040 it is expected to grow to over one trillion US dollars. Companies like SpaceX, Blue Origin or Virgin Galactic only make up a small part of this. Most commercial space companies specialize in satellites and satellite communications, and with good reason: While it cost 23,000 US dollars per kilogram of payload to launch a satellite into space during the Apollo program, the average in 2016 was around 2,600 US dollars. Dollar. “Satellite manufacturers have benefited most from falling startup costs, which has had a positive impact on margins and enabled steady cash flow,” said Ron Epstein, space stocks specialist at Bank of America.
Space tourism in particular is significantly more capital-intensive in comparison and is likely to remain in the red for many years to come. In addition, the risk of transporting passengers into space and back again should not be despised, warns Epstein. For him, this is one of the reasons why companies in this area tend to be reluctant to advertise. So far, Virgin Galactic is the only space tourism company that has ventured into the capital market.
With satellite manufacturers, investors have more choice. Companies such as Maxar Technologies or the Luxembourg group SES have been listed on the stock exchange for many years. German engineering is also in great demand in space. The listed satellite manufacturer OHB, based in Bremen, is one of three main contractors for European space travel. 22 satellites for the Galileo navigation system come from OHB, and the Bremen-based company has already completed twelve more or is about to do so. At 2.6 billion euros, the order books in 2020 were fuller than ever before.
However, OHB lost the Galileo project at the beginning of the year; the satellite manufacturer was defeated by Airbus and Thales in the bidding competition. The share then collapsed by 20 percent within a day. In the summer you will see what effects the missed business will have on sales, OHB board member Lutz Bertling told investors and analysts in February.
Anyone who invests in shares in the space industry must expect such severe setbacks. “The market doesn’t like unpredictable cash flows, haha,” Tesla pioneer Musk flapped about the short message service Twitter in September – at the time in connection with a possible IPO of his Internet service Starlink. The SpaceX division is expected to bring around 12,000 satellites into orbit in the next few years in order to offer fast and reliable broadband internet worldwide. There have long been rumors that a Starlink IPO might be imminent. Musk confirmed it with his tweet, but didn’t want to commit to any point in time. A prerequisite for an IPO is stable sales growth, he explained. It could be a few more years before that happens.
The pandemic hit aviation hard. In 2020 the aircraft manufacturer delivered 40 percent fewer jets than in 2019. Sales fell by 37 percent to 30.2 billion euros. The space division grew, however, delivering a fifth of sales and adjusted operating profit up 17 percent. In February NASA placed another order. A sharp increase in earnings is expected for the group in 2021.
The satellite manufacturer from Bremen is one of the three main suppliers of the European space organization Esa. In 2018, the company passed the billion mark for the first time. In 2020, the management board expects sales of just under one billion euros. In 2021, boss Lutz Bertling wants to cross the billion mark again, he said in February. Full order books should help: At 2.6 billion euros, the order book is higher than ever.
The British billionaire Richard Branson has set himself the goal of offering tourist travel into space and brought the space division to the stock exchange in 2019. At the time, the company reported $ 210 million in net losses on $ 38 million in sales. The breakeven point is still far in the depths of space. The share is not traded in Germany and is only a consideration for those who take extreme risks.
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