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Iridium Announces Third-Quarter 2013 Results

Stocks in this article: IRDM

MCLEAN, Va., Oct. 31, 2013 (GLOBE NEWSWIRE) -- Iridium Communications Inc. (Nasdaq:IRDM) ("Iridium") today reported financial results for the third quarter of 2013 and affirmed its recently updated full-year 2013 outlook. The Company also withdrew its long-range outlook as it continues to evaluate the impact of lower commercial equipment sales and commercial subscriber additions on its operating plan. Net income was $16.6 million, or $0.19 per diluted share, for the third quarter of 2013, as compared to $17.8 million, or $0.23 per diluted share, for the third quarter of 2012. Operational EBITDA ("OEBITDA") (1) for the third quarter was $53.3 million, as compared to $57.6 million for the prior-year period, representing a year-over-year decline of 7 percent and an OEBITDA margin (1) of 53 percent. OEBITDA fell largely due to a decrease in equipment revenue and higher projected Iridium OpenPort ® warranty-related costs.

Iridium reported third-quarter total revenue of $100.6 million, which consisted of $75.4 million of service revenue and $25.2 million of equipment, engineering and support revenue. Total revenue was unchanged versus the comparable period of 2012, while service revenue grew 6 percent from the year-ago period. Service revenue, which represents primarily recurring revenue from Iridium's growing subscriber base, was 75 percent of total revenue for the third quarter of 2013 as compared to 71 percent in the year-ago period.

The Company ended the quarter with 655,000 total billable subscribers, which compares to 595,000 for the year-ago period and is up from 647,000 for the quarter ended June 30, 2013. Total billable subscribers grew 10 percent year-over-year, driven by strength in machine-to-machine ("M2M") and commercial voice customers.

"We're pleased to have recently closed on landmark services and support contracts with the U.S. Department of Defense, reaffirming the importance of Iridium's solutions to our single biggest customer," said Matt Desch, CEO, Iridium. "These agreements totaling $438 million over five years provide us with growing and predictable cash flow during the Iridium NEXT construction and launch period. Importantly, it gives our government subscribers stable, low-cost and more universal access to our network as their demand grows and they take full advantage of its capabilities. It's an undeniable win-win as we look ahead to extending our more than decade-long relationship."

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