6th May 2015 06:58
LONDON (Alliance News) - Inmarsat PLC Wednesday maintained its expectations for 2015 and its longer-term guidance, as lower revenue from its cooperation agreement with LightSquared Inc and the sale of some retail-energy related assets led to a fall in pretax profit in its first quarter.
The satellite services company posted a pretax profit of USD96.3 million for the quarter to end-March, down from USD126.3 million a year before, as revenue declined to USD304.8 million from USD344.7 million.
Inmarsat said revenue from the LightSquared agreement was USD27.8 million lower in the quarter, as a result of payments from LightSquared not being paid on time. LightSquared collapsed into bankruptcy in May 2012, and whilst it is looking to exit from bankruptcy subject to some approvals, this means that payments from LightSquared continue to be subject to uncertainty, it said.
Additionally, Inmarsat said that the sale of retail energy-related assets in its Enterprise business unit during 2014 had led to a reduction in revenue of USD8.0 million. Compounding this, its Government business continued to slow down, offsetting growth in Maritime, Enterprise and Aviation.
Despite the quarter "starting slowly", Imarsat said that momentum had developed well towards the end of the period, particularly in its Maritime business.
Its expectations for the full year are unchanged, the company said. It expects a similar trading environment to 2014 with continued growth in Maritime, Enterprise and Aviation, and continued weakness in Government, particularly in the US.
The company said its third Global Xpress satellite is on track for launch in early June, and it now expects commercial launch of global Global Xpress services mid-to-late in the third quarter, which is slightly later than originally planned but does not change its expectations for Global Xpress revenue growth in 2015 or the longer term.
"We remain confident about the underlying growth and margin trends across all of our business units, and that we will deliver our wholesale Mobile Satellite Service revenue target for 2015 and beyond," said Chief Executive Officer Rupert Pearce in a statement.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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