Q1 2022

Continued growth and customer momentum

Today, Inmarsat reported robust financial results for the first quarter of 2022, which underscores our status as a world-leader in global mobility communications. In the first quarter, our revenues rose by 8% year-on-year, while our EBITDA climbed 10% and free cash flow increased by 44%. Despite geopolitical uncertainties and supply chain risks, we are confident that we will grow both revenue and EBITDA^[1] for full year 2022 compared to last year.

In the first three months of 2022, we delivered strong growth in our Aviation and Government business units, including excellent performance with government customers outside the United States. Rising demand in our Aviation and Government units, coupled with continued stabilisation in Maritime, more than offset the impact of global supply chain pressures on our Enterprise unit.

At a time when resilient satellite connectivity has never been more important, Inmarsat has reinforced its position as a trusted provider of critical global mobility services, reflected by our solid order book and new business wins. Highlights of our business unit performance include:

• Aviation had a terrific quarter, increasing its revenues by 45% year-on-year as the recovery in the commercial and business aviation industry continued. We enjoyed a sharp increase in IFC revenue, which climbed 34% and increased our installed base of aircraft to 836, up by 2% compared to last year. Business aviation had an excellent quarter, with revenues up 53% and 1,150 aircraft installations, up 23% year-on-year. Communication services to the cockpit grew by 35%.
• Maritime continues to stabilise with its second quarter of sequential growth. Excluding a one-off impact last year related to the Speedcast acquisition, underlying revenues in the quarter were up by 2% year-on-year. Fleet Xpress (FX) installed vessels increased by 20% to 12,200, and we have a record backlog for future installations.
• Government revenues grew 10% in the quarter. Non-US revenues rose 31% on the back of strong terminal sales, continued growth in Global Xpress connections and improved leasing revenues. US revenues rose 1% in the first quarter, with higher leasing and one-off project sales partially offset by lower SwiftBroadband streaming and BGAN revenues. Despite the slow start to the year, we currently expect to deliver revenue growth in the mid-single digits in our US Government business for full-year 2022.
• Enterprise saw revenues decline 15%, largely driven by continued disruption to global supply chains, which we do not expect to abate significantly over the next few quarters. We are moving forward with a pivot to the growing IoT market, but that transition will take time to have a material impact. As we make this change, we are well positioned to leverage our L-band spectrum, global GEO network, existing portfolio and partner ecosystem.

During the quarter we made progress towards securing regulatory approval for our proposed combination with Viasat. Clearance has now been secured from foreign direct investment and competition authorities in several markets. In addition, Viasat received SEC approval of its proxy statement, meaning a shareholder vote on the transaction will be held June 21, 2022. We expect further regulatory approvals by the end of the summer and for the transaction to close in 9-18 months from signing, with a goal of closing by the end of this calendar year. I remain convinced of the business logic of this exciting combination, which will build on our product strengths, customer relationships and technology leadership.

With thanks and warm regards,

Rajeev Suri
CEO

^[1] Excluding Viasat transaction costs