9th Nov 2009 07:00
Inmarsat Holdings Limited Reports Third Quarter 2009 Results
London, UK: 9 November 2009. Inmarsat Holdings Limited, a wholly-owned subsidiary of Inmarsat plc (LSE: ISAT), the leading provider of global mobile satellite communications services, today reported unaudited consolidated financial results for the 3 months ended 30 September 2009. A copy of the financial reports for both Inmarsat Holdings Limited and Inmarsat Group Limited for the third quarter can be accessed via the investor relations section of our website. Copies of these financial reports will also be furnished to the SEC later today on form 6-K.
Q3 Highlights - Inmarsat Holdings Limited
Revenue up 8.7% to $176.7m (2008: $162.5m)
EBITDA up 18.4% to $133.0m (2008: $112.3m)
Profit after tax up 33.5% to $50.2m (2008: $37.6m)
Free cash flow up 90.6% to $102.9m (2008: $54.0m)
Andrew Sukawaty extends CEO term for two years
$500m Senior Credit Facility refinancing completed
Andrew Sukawaty, Inmarsat's Chairman and Chief Executive Officer said, "These third quarter results show that we are continuing to achieve growth in all our MSS markets despite the economic downturn. In addition, our cost control and reduced capital expenditure needs are contributing respectively to strong EBITDA growth, up 18.4%, and a substantial increase in free cash flow, up over 90%, year over year. In addition we are seeing the benefits of improved terms with our distributors, following the implementation of new agreements in April 2009. We are well positioned to deliver on our targets for the full year."
Mobile Satellite Services
Third quarter maritime sector revenue grew by 9.2%, principally driven by data services, which grew by 13.1%. Our maritime revenue growth was dominated by demand for our Fleet and FleetBroadband services, supported by resilient usage levels on older services, such as Inmarsat-B. Contributing to growth in active terminals of 12.0%, we saw strong sales of our Fleet and FleetBroadband terminals, with the third quarter being the strongest quarter of net additions in the year and with FleetBroadband sales more than double sales of Fleet in the quarter.
Our land mobile sector revenue was up 4.0%, a stronger performance when compared sequentially to the second quarter. Land mobile revenue growth was driven by BGAN, where ARPU was at the highest level of the year at $274 per month. Land mobile revenue also benefitted from growth in low data rate services, resulting from our partnership with SkyWave.
Our third quarter aeronautical sector revenue grew by 10.1%. Sales of SwiftBroadband terminals were strong in the quarter and exceeded sales of Swift 64 for the first time. SwiftBroadband usage levels are steadily increasing and we are pleased with the early stage development of this service. SwiftBroadband continues to see orders related to the introduction of in-flight cellular services on commercial airlines. In September, British Airways launched a London to New York service equipped with our SwiftBroadband service to support in-flight passenger services.
Our leasing revenue increased by 29.6% in the third quarter, reflecting new leasing business and the expansion of certain aeronautical leasing business.
Liquidity
At 30 September 2009, Inmarsat Holdings Limited had net borrowings of $879.9m, incorporating borrowings of $1,028.2m and cash of $148.3m. Inmarsat Holdings Limited also had a revolving credit facility with an amount available but undrawn at the end of the quarter of $160.0m. Net borrowings reported by Inmarsat Holdings Limited exclude the net borrowings of Inmarsat plc and Stratos Global Corporation and its subsidiaries.
At the end of the third quarter 2009, our ratio of net borrowings to our last twelve months EBITDA was 1.8 to 1.0. We continue to generate significant free cash flow and believe our liquidity is adequate to meet the group's needs.
Results announced today
Inmarsat Holdings Limited, through its subsidiary Inmarsat Finance II plc, is the issuer of $450.0m of 10.375% Senior Discount Notes due 2012. Inmarsat Group Limited, through its subsidiary Inmarsat Finance plc, is the issuer of $160.4m of 7.625% Senior Notes due 2012. Both Inmarsat Holdings Limited and Inmarsat Group Limited are required by the terms of the notes outstanding to report quarterly financial results. Inmarsat plc is the ultimate parent company of the Inmarsat group. On 15 April 2009 Stratos Global Corporation ("Stratos") became an indirect wholly-owned subsidiary of Inmarsat plc.
A copy of the financial reports for both Inmarsat Holdings Limited and Inmarsat Group Limited for the third quarter can be accessed via the investor relations section of our website. Copies of these financial reports will also be furnished to the SEC later today on form 6-K. On 8 November 2009 Stratos announced results for the third quarter ended 30 September 2009 and these results can be accessed via the Inmarsat or Stratos websites.
Other Information
Inmarsat management will host a conference call on Monday, 9 November at 2:00pm London time (United States 9:00am EST). To access the call, please dial +44 (0)20 7162 0025 and enter the access code 849263. A recording of the call will be available for one week after the event. To access the recording please dial +44 (0)20 7031 4064 and enter the access code 849263. The call will also be available by webcast accessible via the investor relations section of our website.
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Inmarsat Holdings Limited Revenue Breakdown |
Third quarter ended 30 September |
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|
2009 |
2008 |
% Difference |
|
|
Revenues |
(US$ in millions) |
||
|
Maritime sector: |
|||
|
voice services |
25.9 |
25.7 |
0.8% |
|
data services |
63.2 |
55.9 |
13.1% |
|
Total maritime sector |
89.1 |
81.6 |
9.2% |
|
Land mobile sector: |
|||
|
voice services |
1.8 |
2.8 |
(35.7%) |
|
data services |
37.0 |
34.5 |
7.2% |
|
Total land mobile sector |
38.8 |
37.3 |
4.0% |
|
Aeronautical sector |
19.7 |
17.9 |
10.1% |
|
Leasing |
26.7 |
20.6 |
29.6% |
|
Total mobile satellite communications services |
174.3 |
157.4 |
10.7% |
|
Other income |
2.4 |
5.1 |
(52.9%) |
|
Total revenue |
176.7 |
162.5 |
8.7% |
|
Active Terminal Data |
Third quarter ended 30 September |
||
|
2009 |
2008 |
% Difference |
|
|
Active terminals (1) |
(000's) |
||
|
Maritime |
169.6 |
151.4 |
12.0% |
|
Land mobile |
73.6 |
80.4 |
(8.5%) |
|
Aeronautical |
10.8 |
9.8 |
10.2% |
|
Total active terminals |
254.0 |
241.6 |
5.1% |
|
Inmarsat Holdings Limited Consolidated Profit and Loss Account |
Third quarter ended 30 September |
|||||
|
2009 |
2008 |
% Difference |
||||
|
(US$ in millions) |
||||||
|
Revenue |
176.7 |
162.5 |
8.7% |
|||
|
Employee benefit costs |
(25.0) |
(28.8) |
(13.2%) |
|||
|
Network and satellite operations costs |
(10.1) |
(9.9) |
2.0% |
|||
|
Other operating costs |
(13.5) |
(17.6) |
(23.3%) |
|||
|
Work performed by the Group and capitalized |
4.9 |
6.1 |
(19.7%) |
|||
|
EBITDA |
133.0 |
112.3 |
18.4% |
|||
|
Depreciation and amortization |
(44.5) |
(42.0) |
6.0% |
|||
|
Operating profit |
88.5 |
70.3 |
25.9% |
|||
|
Interest receivable and similar income |
1.0 |
4.6 |
(78.3%) |
|||
|
Interest payable and similar charges |
(19.5) |
(21.4) |
(8.9%) |
|||
|
Net interest payable |
(18.5) |
(16.8) |
10.1% |
|||
|
Profit before income tax |
70.0 |
53.5 |
30.8% |
|||
|
Income tax expense |
(19.8) |
(15.9) |
24.5% |
|||
|
Profit for the period |
50.2 |
37.6 |
33.5% |
|||
|
Inmarsat Holdings Limited Consolidated Balance Sheet |
As at 30 September |
As at 31 December |
|
2009 |
2008 |
|
|
(US$ in millions) |
||
|
Non-current assets |
1,858.6 |
1,858.7 |
|
Current assets |
||
|
Inventories |
2.3 |
5.0 |
|
Trade and other receivables |
177.0 |
229.1 |
|
Cash and cash equivalents |
148.3 |
51.2 |
|
Derivative financial instruments |
9.8 |
1.1 |
|
Total current assets |
337.4 |
286.4 |
|
Total assets |
2,196.0 |
2,145.1 |
|
Current liabilities |
||
|
Loans and other borrowings |
(374.9) |
(205.9) |
|
Other payables and provisions |
(219.9) |
(169.6) |
|
Non-current liabilities |
||
|
Loans and other borrowings |
(643.6) |
(833.3) |
|
Other payables and provisions |
(90.1) |
(79.3) |
|
Total liabilities |
(1,328.5) |
(1,288.1) |
|
Net assets and shareholders' funds |
867.5 |
857.0 |
Forward-looking Statements
Certain statements in this announcement constitute "forward-looking statements" within the meaning of the U.S. 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 of 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.
Contact:
Inmarsat, London, UK
Investor Enquiries
Simon Ailes, +44 20 7728 1518
Media Enquiries
Christopher McLaughlin, +44 20 7728 1015
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