Amazing profits from a Scottish company that wants to share the wealth here in the US.
PIONEERING space technology firm Clyde Space has seen pre-tax profits grow by 120 per cent to £450,000 as it increases its focus on the US and eyes funding from President Obama’s office of science and technology.
The Glasgow-based developer of mini-satellites doubled revenue to £5.6m in the year to April 30 thanks in part to contract wins with US broadcast company Outernet and a UK Government-backed demonstration initiative with the International Space Station.
Founder and chief executive Craig Clark revealed the company was currently looking at sites on the east and west coasts of the US, where he plans to spend up to 40 per cent of his time.
A sales office is being established in Northern California, while a manufacturing center will open on the east coast, to complement the six satellites a month being delivered from its 85-strong team in Glasgow.
The company has shifted its focus to drive forward momentum, with Jennifer Riddell-Dillet joining as chief operating officer and former Virgin Galactic president Will Whitehorn as chairman.
Mr Clark, who last week welcomed British astronaut Tim Peake to Clyde Space headquarters, said their appointments would allow him to dedicate time to strategy and development, and spending time in the US, which he said was the key region for the company as it continued to expand, as NASA and civil space agencies join commercial enterprises in seeing the value of CubeSats.
“It just so happens, as a Glasgow-based company, we’re considered the best in the world at what we do and we need to maintain that position,” he said.
The company, which was founded in 2005 and in 2014 launched Scotland’s first space satellite, supplies small and micro spacecraft systems that “piggy-back” on other launches. Weighing just 4kg, these CubeSats satellites play an important role in increasing the commercial viability of space research, given their relatively low productions costs.
The White House earlier this month announced $50m in funding for such satellites, which Mr Clark said showed its commitment to the technology. “They’re recognizing the huge amount of potential in that market and they want to fund that, so us being in the US, being one of these companies, we’ll benefit from that funding and the momentum they have over there will be important for us.”
He said the majority of the growth continued to come from commercial investment, but that NASA and civil space agencies are also keen to help groast week welcomed British astronaut Tim Peake to Clyde Space headquarters, said their appointments would allow him to dedicate time to strategy and development, and spending time in the US, which he said was the key region for the company as it continued to expand, as NASA and civil space agencies join commercial enterprises in seeing the value of CubeSats.
Mr Clark acknowledged that following the UK’s decision to leave the European Union some space technology projects could be impacted, but that Brexit wouldn’t itself affect the European Space Agency (ESA). He added that if it led to UK investment switching to the UK Space Agency then there could be a benefit.
He also said the company was able to be a bit more competitive with its global customers since sterling’s collapse. “After the initial fall we gave it a few weeks then decided to reduce our prices in line with the exchange rate, but we’re not trying to play markets. It’s volatile, you don’t know where to price products.”
Mr Clark estimates revenue will grow to £7m in the current year, but added that the company would be investing more, having this year extended to 2,500sq ft its cleanroom for building and testing satellite.
“Our profit will be higher but there will be more costs but we’re not worried about that because we’re aiming for the future. It’s growing so fast we need to prepare ourselves to take on more work.”
The way its products are being made is also changing as the space industry develops. Where previously commercial enterprises would approach manufacturers like Clyde Space with a brief outlining specific requirements, Mr Clark said the industry was switching to a consumer electronics model.
“What we now need to do is predict what the market will want in the next two to three years, manufacture it and then expect people to buy it,” he said.
Currently, CubeSats are used for the likes of border control imaging, tracking ships, tracking planes, delivering Internet of Things capabilities, and Mr Clark said they had reached the point where the devices are powerful enough to help develop virtual reality imaging in space for gaming.
Beyond their current orbit, Mr Clark has said in time he could see his devices orbiting the Moon, Mars and even Saturn’s moon Europa, arguing that the advance of commercial space exploration firm Space X could lead to incredible opportunities.
“It does sound a bit fantastic, but it’s not as crazy as it sounds... Space is a huge part of our lives, and from a business point of view it makes sense for investment.”