Gilat Satellite Networks Awarded Over $5M in Support of the US Department of Defense

Rhea-AI Summary

Gilat Satellite Networks (NASDAQ, TASE: GILT) has announced that its US subsidiary, DataPath Inc, has secured contracts worth over $5 million to support the US Department of Defense. The contracts involve:

1. Core terminal related services
2. Technology insertion
3. Upgrades to systems

DataPath will focus on sustaining and upgrading multiple Satellite Transportable Terminal (STT) units to enhance military operations. Additionally, they will upgrade existing satellite communications equipment to improve capabilities and efficiency. This reinforces Gilat's commitment to supporting the US armed forces and advancing national security.

Positive

• Secured contracts worth over $5 million with the US Department of Defense
• Enhancing critical assets for military operations
• Upgrading existing satellite communications equipment for improved capabilities
• Strengthening position in the defense sector

Negative

• None.

Insights

Defense Technology Analyst

The $5M contract award to Gilat's subsidiary DataPath for US DOD satellite terminal upgrades is a positive development for the company. This contract demonstrates Gilat's strong position in the defense satellite communications market and its ability to secure high-value government contracts.

The focus on technology insertion and system upgrades aligns with the DOD's ongoing efforts to modernize its communications infrastructure. This could potentially lead to follow-on contracts and a long-term relationship with the DOD, providing a stable revenue stream for Gilat.

However, investors should note that while $5 million is significant, it's relatively small compared to Gilat's annual revenue. The real value lies in the strategic positioning and potential for future contracts rather than immediate financial impact.

Financial Analyst

From a financial perspective, this contract is a modest but positive development for Gilat. With the company's 2023 revenue at $239.8 million, this $5+ million contract represents about 2% of annual revenue. While not transformative, it contributes to the company's backlog and provides revenue visibility.

Investors should focus on:

• Potential for margin improvement through technology upgrades
• Recurring revenue opportunities from sustainment services
• Enhanced competitive position in the defense sector

This contract could serve as a catalyst for Gilat's stock, especially if it leads to larger future awards. However, the immediate financial impact is likely to be and investors should view this more as a strategic win than a significant revenue boost.

Gilat will support the US DOD with critical satellite terminal requirements and terminal technology insertion programs

PETAH TIKVA, Israel, Sept. 16, 2024 (GLOBE NEWSWIRE) -- Gilat Satellite Networks Ltd. (NASDAQ, TASE: GILT), a worldwide leader in satellite networking technology, solutions, and services, announced today that its wholly owned US-based subsidiary, DataPath Inc, received contracts in support of the US Department of Defense for core terminal related services, technology insertion and upgrades to systems, cumulatively worth over $5M.

DataPath is tasked with the sustainment and technical upgrades to multiple Satellite Transportable Terminal (STT) units to enhance these critical assets and the effectiveness of military operations.

In addition, DataPath will undertake upgrades to existing satellite communications equipment to both enhance the capabilities of these systems and to make them leaner and more efficient for our men and women in uniform to operate.

“DataPath is honored to support the U.S. military with these projects” said Nicole Robinson, President of DataPath, Inc. “We are dedicated to delivering solutions that enhance the capabilities and reliability of military communications and to supply the latest in technology upgrades and updates. These contracts reinforce our commitment to supporting our armed forces and advancing national security.”

About Gilat

Gilat Satellite Networks Ltd. (NASDAQ: GILT, TASE: GILT) is a leading global provider of satellite-based broadband communications. With over 35 years of experience, we create and deliver deep technology solutions for satellite, ground, and new space connectivity and provide comprehensive, secure end-to-end solutions and services for mission-critical operations, powered by our innovative technology. We believe in the right of all people to be connected and are united in our resolution to provide communication solutions to all reaches of the world.

Our portfolio includes a diverse offering to deliver high-value solutions for multiple orbit constellations with very high throughput satellites (VHTS) and software-defined satellites (SDS). Our offering is comprised of a cloud-based platform and high-performance satellite terminals; high-performance Satellite On-the-Move (SOTM) antennas; highly efficient, high-power Solid State Power Amplifiers (SSPA) and Block Upconverters (BUC) and includes integrated ground systems for commercial and defense, field services, network management software, and cybersecurity services.

Gilat’s comprehensive offering supports multiple applications with a full portfolio of products and tailored solutions to address key applications including broadband access, mobility, cellular backhaul, enterprise, defense, aerospace, broadcast, government, and critical infrastructure clients all while meeting the most stringent service level requirements. For more information, please visit: http://www.gilat.com

Certain statements made herein that are not historical are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995. The words “estimate”, “project”, “intend”, “expect”, “believe” and similar expressions are intended to identify forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties. Many factors could cause the actual results, performance or achievements of Gilat to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, including, among others, changes in general economic and business conditions, inability to maintain market acceptance to Gilat’s products, inability to timely develop and introduce new technologies, products and applications, rapid changes in the market for Gilat’s products, loss of market share and pressure on prices resulting from competition, introduction of competing products by other companies, inability to manage growth and expansion, loss of key OEM partners, inability to attract and retain qualified personnel, inability to protect the Company’s proprietary technology and risks associated with Gilat’s international operations and its location in Israel, including those related to the current terrorist attacks by Hamas, and the war and hostilities between Israel and Hamas and Israel and Hezbollah. For additional information regarding these and other risks and uncertainties associated with Gilat’s business, reference is made to Gilat’s reports filed from time to time with the Securities and Exchange Commission. We undertake no obligation to update or revise any forward-looking statements for any reason.

Contact:

Gilat Satellite Networks
Hagay Katz, Chief Products and Marketing Officer
Hagayk@gilat.com

EK Global IR
Ehud Helft, Managing Partner
ehud@ekgir.com

FAQ

What is the value of the contracts Gilat Satellite Networks (GILT) received from the US Department of Defense?

Gilat Satellite Networks (GILT) received contracts cumulatively worth over $5 million from the US Department of Defense.

What services will Gilat Satellite Networks (GILT) provide to the US Department of Defense?

Gilat will provide core terminal related services, technology insertion, and upgrades to systems, including sustainment and technical upgrades to multiple Satellite Transportable Terminal (STT) units.

Which Gilat subsidiary is handling the US Department of Defense contracts?

DataPath Inc, a wholly owned US-based subsidiary of Gilat Satellite Networks, is handling the contracts with the US Department of Defense.

How will the upgrades by Gilat (GILT) benefit the US military?

The upgrades will enhance the capabilities and reliability of military communications, making the systems leaner and more efficient for military personnel to operate.