Intelsat and Viasat Release Earnings Reports
November 10, 2011
This week two satellite communications companies—Intelsat and Viasat—released quarterly earnings statements, with both companies outlining the status of their fleets and future projects.
The Intelsat Third Quarter 2011 Results reported that the company had revenues of $652.9 million and a net loss of $0.4 million for the three months ended Sept. 30, 2011.
"Intelsat delivered steady results in the third quarter, supported by the visibility provided by our $10.7 billion contracted backlog," said David McGlade, Intelsat CEO. "Several trends influenced our results in the third quarter, as in recent periods, including strength in our government business and solid performance from our media business. Our overall business activity is strong, and we are achieving success in obtaining long-term commitments from blue chip customers for capacity in the fastest growing markets, such as our recently announced services agreement with DirecTV Latin America. This contract builds quality backlog and adds two new satellite programs for the attractive Latin America region."
He added that the company will continue "to leverage our satellite fleet and unmatched collection of orbital rights" in order to deliver satellite capacity "to regions of improved opportunity." He cited the company's decision to relocate its Horizons 2 satellite from North America to serve growth in Russia.
"Following the successful launch of Intelsat 18 in early October 2011, our fleet investment program progresses, with six satellites planned for launch through the first half of 2013 that will provide growth capacity and new beams, and two additional satellites, launching in 2014 and 2015, to support the DirecTV agreement," McGlade said.
The Intelsat report says in-orbit testing of Intelsat 18 is complete and all performance is normal. Intelsat 22 is scheduled to launch in 1Q 2012. The problem with the C-band reflector on Intelsat New Dawn has not been remedied and the New Dawn joint venture will likely file a partial loss claim with insurers. Proceeds will be used to pay down the venture's debt. Intelsat said that in 3Q 2011 it had reduced its contracted backlog by $300.8 million that was previously associated with future revenue on Intelsat New Dawn satellite's C-band capacity.
Viasat reported Second Quarter Fiscal Year 2012 Results showing revenues of $223 million for the quarter and net income of $8 million.
"Second fiscal quarter results for new orders, revenues and adjusted EBITDA fit our expectations given the ViaSat-1 launch delays," said Mark Dankberg, chairman and CEO of Viasat. "But the main event has been the successful launch and activation of ViaSat-1subsequent to quarter end. We expect to begin new services at the end of this quarter that we believe will make satellite a better choice for many people who are underserved by terrestrial broadband connections."
He went on to cite national defense budget issues and associated program delays as creating "some near term impact on our government results, and the mix of business." He noted, however, that the company had received new contract awards in the first half of the year that are valued at nearly half a billion dollars, a gain of some 23 percent from the previous year.
"The combination of new orders with the launch of ViaSat-1 creates exciting growth opportunities, despite the macro environment," said Dankberg.
Other business highlights for the quarter included expanding coverage of ViaSat's "Yonder" high-speed mobile Internet service to Chile, Argentina, Bolivia, Columbia, Ecuador, Peru and surrounding areas.