Inmarsat plc reports First Quarter Results 2015

Solid operational performance; on track for launch of third GX satellite

London, UK: 6 May 2015.  Inmarsat plc (LSE: ISAT.L), the leading provider of global mobile satellite communications services, today provided the following unaudited information for the three months ended 31 March 2015.

First Quarter Headlines

  • Total revenues $304.8m (Q1 2014: $344.7m)
    • Maritime up $1.6m to $149.8m (+1.1%)
    • Government down $12.7m to $66.8m (-16.0%)
    • Enterprise down $5.5m to $38.9m (-12.4%); underlying growth (excl. disposal) +6.9%
    • Aviation up $4.9m to $27.1m (+22.1%)
    • Revenues from LightSquared down $27.8m to $17.5m (Q1 2014: $45.3m)
  • Wholesale Mobile Satellite Service (MSS) revenues $198.2m, up 3.5% (Q1 2014: $191.5m)
  • Total EBITDA1 $176.8m (Q1 2014: $209.9m)
  • Profit after tax $77.4m (Q1 2014: $100.2m)

Operational Highlights

  • I-5 F2 launched and now deployed successfully into geostationary orbit
  • I-5 F3 shipped to Baikonur and on track for launch in early June
    • Key voice and data services in the EMEA region transitioned successfully to Alphasat
    • Significant progress made in Aviation contracts and S-band licensing
    • First Inmarsat Developer Conference held, to drive growth of innovative solutions

Read the full set of Quarter 1 financial results.

Rupert Pearce, Inmarsat’s Chief Executive Officer, commented,

“This was a solid quarter of trading, although starting slowly, in particular in Maritime and certain Government contracts.  However momentum developed well towards the end of the period, especially in Maritime, with strong growth in FleetBroadband subscribers and ARPU as well as XpressLink installations.  We remain confident about the underlying growth and margin trends across all of our business units, and that we will deliver our wholesale MSS revenue target for 2015 and beyond.

Our third GX satellite, I-5 F3, has been shipped to Baikonur and is on track for launch in early June.  We now expect commercial launch of global GX services mid-to-late in the third quarter, which is slightly later than originally planned but does not change our expectations for GX revenue growth in 2015 or over the longer term.

There was significant progress in Aviation in the quarter, with several major new cabin connectivity contracts in advanced stages of negotiation, and the S-band license acquisition process moving forward well.  Plans for developing our air-to-ground network are also progressing well.”

Outlook

Our expectations for the Group’s performance in 2015 remain unchanged.  The trading environment is expected to be broadly similar to 2014, with continuing underlying revenue growth in Maritime, Enterprise and Aviation and continued weakness in Government, particularly in the US.

The Group’s longer term guidance remains unchanged:

  • Wholesale MSS revenue is expected to fall within the 8-12% CAGR growth range for 2014-16.
  • Annual GX revenues of $500m are expected by the fifth anniversary of the global launch of commercial GX services.
  • 2015 capex is expected to be in the range $450-500m, and capex in both 2016 and 2017 is expected to be below $400m.

Results Conference Call

Inmarsat management will discuss the first quarter results in a conference call on Wednesday 6 May 2015 at 08.30 hrs London time.

To access the call please dial +44(0)20 3427 0503. The conference id for the call is 1288566. The call will also be web-cast at www.inmarsat.com.

The call will be recorded and available on our website after the event. A copy of this announcement can also be found on our website at www.inmarsat.com.

Forward looking Statements

This announcement contains “forward-looking statements” within the meaning of the US Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks, uncertainties and other factors that may cause our actual results, performance or achievements, or industry results, to be materially different from those projected in the forward-looking statements. These factors include: general economic and business conditions; changes in technology; timing or delay in signing, commencement, implementation and performance or programmes, or the delivery of products or services under them; structural change in the satellite industry; relationships with customers; competition; and ability to attract personnel.  You are cautioned not to rely on these forward-looking statements, which speak only as of the date of this announcement.  We undertake no obligation to update or revise any forward-looking statement to reflect any change in our expectations or any change in events, conditions or circumstances.

Other Information

While Inmarsat plc is the ultimate parent company of our group, our subsidiary Inmarsat Group Limited is required by the terms of our Senior Notes to report consolidated financial results on a quarterly basis.  A copy of the resulting financial report for Inmarsat Group Limited will be available via the Investor Relations section of our website.

Contact: Inmarsat plc, London, UK

Investor Enquiries:
David Boyd
Tel: +44 (0)20 7728 1518
david.boyd@inmarsat.com
Media Enquiries:
Chris McLaughlin/Jonathan Sinnatt
Tel: +44 (0)20 7728 1935
chris.mclaughlin@inmarsat.com
jonathan.sinnatt@inmarsat.com

[1]  EBITDA is defined as profit before finance income and expenses, taxation, depreciation and amortisation, losses on disposal of assets, impairment losses and share of profit of associates