AAC Clyde’s EPS-Sterna contract on for July?

AAC Clyde (STO: AAC) became the first new space public company to post two consecutive profitable quarters. Continued profitable growth is CEO Luis Gomes stated goal for 2025. More growth appears coming with Sterna.

As far back as 2018, the ESA contracted Omnisys to provide its Water Vapour Radiometer for the Arctic Weather Satellite (AWS) mission. AWS is the forerunner to the EPS-Sterna constellation, which plans for 18 satellites plus two spares. AAC Clyde acquired Omnisys in 2021.

AAC Clyde previously stated in a March 2021 presentation (now removed from its website) that if the EPS-Sterna constellation proceeds and the payload contract is awarded to AAC Omnisys, contract revenue could exceed €78 million. For the mission to go ahead, all European member states must approve it. Currently, all indications suggest EPS-Sterna will proceed.

1. In February 2025, OHB Sweden ordered long lead-time components from AAC Clyde for the EPS-Sterna constellation. AAC Clyde described this as a “kick-off order” worth €1 million. It is unlikely OHB Sweden would place such an order without confidence that ESA will award the project contract.
2. In response to a question from an investor in February 2025, CEO Luis Gomes implied expecting the contract to be awarded in mid-2025. He also estimated the value of the EPS-Sterna contract to be around €60 million.
3. The United Nations posted a job vacancy for a program manager to oversee the EPS-Sterna project. The job posting states, “the contract for the successful candidate will only be issued after obtaining formal approval of the EPS-Sterna Programme by EUMETSAT Member States, expected in early July 2025.”

If €60 million correctly estimates the amount due to AAC Clyde should the contract be approved, this represents a significant upside for the already profitable AAC Clyde Space. The delivery schedule is not yet known, but the first six satellites are slated for launch in 2029. Assuming AAC Clyde delivers the payload for these between now and the end of 2027, this equates to approximately €1.87 million (SEK 19.9 million) in additional quarterly revenue. Annualized, this represents approximately 22% of the 2024 revenue amount.