AGM Statement

INMARSAT PLC - ANNUAL GENERAL MEETING: 7 MAY 2014

ANDREW SUKAWATY: EXECUTIVE CHAIRMAN

It's 10 o'clock. Good morning, ladies and gentlemen, and welcome to Inmarsat plc's 2014 Annual General Meeting.

As we announced our first quarter results for 2014 this morning, I will have the opportunity to cover key highlights from our performance in 2013 and the first part of 2014.

On our analyst call this morning, Rupert Pearce, our CEO reported that we have made a strong start to the year in both our wholesale MSS business and in our retail operations. Total Group revenues for the first quarter of 2014 increased by 9.9%, compared with the same period for 2013. The increase was primarily as a result of increased revenues recognised in relation to our Cooperation Agreement with LightSquared, our acquisition of Globe Wireless and increased revenues from our Inmarsat Global MSS business, partially offset by a reduction in revenue following the disposal of the majority of our retail energy assets to RigNet at the end of January. We managed our operating costs well during the first quarter and with the contribution of the items mentioned above our EBITDA grew strongly.

Our wholesale MSS business, which delivers the vast majority of our cash flow and profit generation, grew 3.7% in the first quarter compared to last year. Our Inmarsat Solutions business saw revenue growth for the first quarter of 1.4% with strong growth in its Inmarsat MSS services offset by lower revenues from its other reporting sector.

In the first quarter, we've continued our focus on the delivery of the Global Xpress (or GX) programme and I'm pleased to confirm that we remain on track for commercial service introduction over the Indian Ocean region from July 2014. Our first Inmarsat-5 satellite which was launched in December 2013 will provide the coverage for the IOR services. The Inmarsat-5 F2 and F3 satellites have also been fully assembled and Inmarsat-5 F2 is in final preparations for shipment to the launch site. We continue to believe and be advised that current US and EU restrictions in place against the Russian Federation do not affect our launch plans. We remain on track and on budget and we continue to make strong progress across a range of diverse programme activities. Establishing a new communications platform requires more than just the satellites to ensure its success. We are also building a new ground network for our GX services to be deployed around the world and four of the six gateways are already completed. We have partnered with world class manufacturers to cover our target markets and applications and we're excited that they have the same commitment as we do to bring GX to a successful introduction. Finally, our investment in a highly innovative service enablement platform, through Cisco, will provide the glue between our L-band and Ka-band networks to bring them together into a unique integrated capability.

In 2013, we actively reviewed the structure of our business and looked at what we could do to strengthen or maximise value through acquisition or divestment. The activities we undertook all support our long-term growth strategy: two acquisitions of businesses, one to strengthen our VSAT, military satcoms, aviation and solutions skills in Inmarsat's Global Government and Enterprise business units; and the other to provide value-added maritime communications services to the shipping market; plus we completed a bundled transaction to create a strategic partnership for the distribution of GX and L-band services to the energy sector, and the divestment of our retail energy business.

A key focus during 2013 was on the BRICs (Brazil, Russia, India and China) markets and we are working on various opportunities to open up these markets. One key achievement late in 2013 was the opening of a BGAN satellite access station ('SAS') in Beijing, China. With important funding from the Chinese government, this four year programme was led by a joint team from Inmarsat and our long-standing Chinese distribution partner, MCN. The China BGAN SAS will allow us to comply with regulatory and legal requirements which stipulate that we must have a physical gateway in China to sell our Inmarsat-4 services there.

Looking now at our vertical markets, I will start with our maritime services which are the largest contributor to our wholesale MSS revenues. The steady migration away from our legacy maritime services, that began to gather momentum in 2012, continued in 2013 and into 2014, and is a contributing factor to the growth of FleetBroadband. We also believe that FleetBroadband has expanded our addressable market for our other maritime broadband services. The level of subscriber and revenue growth achieved in maritime in 2013, and continuing in the first quarter of 2014, is a reflection that ship owners and fleet managers see the benefits and value of our services, and reflects extensive efforts to offer customers not just reliability and unique service capabilities but also agility, flexibility and choice in the way that these services are procured and deployed. There has been good take-up of our XpressLink service throughout 2013 and into 2014 and in due course, after maritime GX services are commercially introduced, our XpressLink customers are expected to migrate to GX, and this will have a corresponding increase in wholesale revenue.

We are proud of our maritime heritage and that we continue to meet the stringent requirements set down by the International Maritime Organization for the provision of the Global Maritime Distress and Safety System. We are the only satellite provider approved to offer this service. This highly reliable system allows mariners to get help when they need it and has been instrumental in saving thousands of lives globally. We continue to invest to enhance our safety services and are now working to certify our newest generation of FleetBroadband terminals for safety services.

Turning to the land mobile sector, we continued to see the trend during 2013 extend into the first quarter of 2014 with revenues under pressure. Although we continue to see growth in BGAN usage from new subscribers, this growth is unable to fully offset the impact of reduced revenues from event-driven BGAN traffic and other lower BGAN usage. Offsetting the decrease in the first quarter of 2014 is an increase in revenues from our IsatPhone Pro and machine-to-machine or M2M services. Towards the end of 2013 we introduced our new BGAN High Data Rate service, offering higher data streaming speeds. We believe that BGAN HDR will be very attractive to the global media community.

We are now seeing exciting market opportunities in the global M2M market. In 2013, we announced a strategic collaboration with Orbcomm Inc., which is a leading provider of low-end satellite M2M solutions and in the first quarter of 2014, we signed a large M2M contract which will start to contribute revenues during the second quarter of this year. We won this contract from another MSS operator, which provides evidence of our progress in this market. We continue to be very pleased by the uptake of our first handheld phone - IsatPhone Pro and the success of this product has led to the development of our next generation product - IsatPhone 2. This was launched in March and we have already taken orders.

I'd like to now make a few comments on our aviation business sector. Throughout 2013 and into 2014, we have seen strong growth in revenues from our SwiftBroadband service, in both the business jet and commercial air transport segments. However, this increase has been partially offset by a decline in Swift 64 revenues, due to a reduction in usage by certain government customers, including usage related to reduced activity in Afghanistan. SwiftBroadband continues to be our fastest growing aviation service. The growth in SwiftBroadband terminal numbers in the air transport market has been driven by airlines continuing to roll out connectivity programmes in passenger cabins. With the number of connected aircraft continuing to grow, SwiftBroadband usage has risen accordingly, driven by the increase in passenger acceptance of in-flight connectivity. SwiftBroadband has proved to be a market-leading offer in the business aviation segment and is a factory option on all high-end business aircraft. We remain committed to the provision of International Civil Aviation Organisation ('ICAO') approved satellite safety services. Last year, we invested in and upgraded the ground infrastructure that supports our Aero Classic safety services, successfully transferring all traffic onto the new network progressively through the year. We are also introducing SwiftBroadband safety services to bring priority IP connectivity to the cockpit for the first time and we expect this service will undergo industry approval flight testing with airlines and business jet operators during 2014. We are additionally investigating how we can contribute more to the future development of aviation safety services.

During 2013, our US Government business suffered from margin compression in the services it offers due to the non-renewal of certain contracts and the renewal of other contracts at lower prices due to intense competition for such services to the US Government. The ongoing troop withdrawals from Iraq and Afghanistan also impacted revenues. We took action during 2013 to manage our cost structure in this part of our business and introduced new senior management to lead the business. We're glad that for the first quarter of 2014, trading has been stable line with our expectations.

Our Global Government business covers all non-US government requirements and its performance was impacted in a similar way to our US government business by a slowdown in government spending and troop withdrawals from Afghanistan. We already have new orders and ongoing trials for a new product initiative which is an L-band Tactical radio solution which was launched in 2013.

We have also broadened our reach in serving government customers worldwide. The Global Government business unit has prioritised geographic expansion and worked closely with channel partners throughout 2013 and will do so in 2014 to bring our capabilities to an increasing number of civil government and military customer organisations.

Our results for 2013 were achieved with the backdrop of the biggest capital investment year by far in Inmarsat's 34 year history. Even with this significant investment programme, our full year dividend recommendation for 2013 allows us to deliver a 5% increase. This is our eighth consecutive year of dividend increases, every year since our IPO in 2005. Not only did we launch an additional satellite to enhance our Inmarsat-4 L-band fleet, but at the end of the year, we launched the first of our new Inmarsat-5 Ka-band satellites for our Global Xpress programme. We believe that these investments, along with the commercial development programmes associated with them, establish the platform to allow us to grow and retain our leadership in the global mobile satellite sector. Our strong start to 2014 builds on our ambitions from 2013 where our leading L-band services and the launch of Global Xpress position us for long-term growth. We have already seen risks retired from our Global Xpress programme with launch and successful in-orbit testing of first Inmarsat-5 Ka-band Global Xpress satellite and we are on schedule for two Inmarsat-5 satellite launches in 2014. We are focused on introducing a new wave of innovative products which we expect will generate additional value for customers. Our ambitions can be achieved through the continued collaboration with our partners and eco-system and importantly with the support and dedication from our staff around the world.

Finally, it would be remiss of me not to make a comment on our involvement with the investigation and search for the missing Malaysian plane, MH370 and extend our sympathies to the families involved. We are indebted to the skill and professionalism of our team in providing vital support and information in the search for the missing aircraft MH370.

Thank you for your investment in Inmarsat.