News Release
Intelsat Announces Preliminary Fourth Quarter and Full Year 2015 Results
-
Preliminary fourth quarter revenue of
$571.3 million ; preliminary full year 2015 revenue of$2,352.5 million -
Expects to incur a non-cash impairment charge resulting in a
substantial reduction of our
$6.8 billion goodwill and other intangible assets -
Preliminary fourth quarter net income attributable to
Intelsat S.A. of$49.1 million , prior to the effect of any impairments; preliminary full year 2015 net income attributable toIntelsat S.A. of$242.0 million , prior to the effect of any impairments -
$9.4 billion contracted backlog provides visibility for future revenue and cash flow -
Reports open market purchase of approximately
$25 million of Intelsat Luxembourg Senior Notes due 2018 -
Intelsat EpicNG satellite era begins,
following successful launch and orbit raising of
Intelsat 29e -
Intelsat issues 2016 Guidance
The company expects to incur a non-cash impairment charge resulting in a
substantial reduction of our
At present, we believe this process will be completed in the next two
weeks after which we would expect to file our Annual Report on Form 20-F
for the year ended
All three months ended and year ended 2015 financial information provided in this release is preliminary and presented prior to giving effect to any impairment charges we ultimately incur.
The company reported preliminary net income attributable to
For the year ended
“With
Mr. Spengler added, “Our backlog continues to provide the visibility
into future revenue and cash flows that allows us to invest in our fleet
and pursue our long-term business strategy. Year-end 2015 backlog of
Preliminary Fourth Quarter and Full Year 2015 Business Highlights
Network Services
Preliminary Network Services total revenue for the three months ended
Media
Preliminary Media total revenue is
Government
Preliminary Government total revenue is
Average Fill Rate
Intelsat’s average fill rate on our approximately 2,150 station-kept
transponders was 76 percent at
Satellite Launches
Contracted Backlog
At
Corporate Appointments
On
Capital Markets and Debt Transactions
During the three months ended
Preliminary Financial Results for the Three Months Ended
On-Network revenue generally includes revenue from any services delivered via our satellite or ground network. Off-Network and Other revenue generally includes revenue from transponder services, Mobile Satellite Services (“MSS”) and other satellite-based transmission services using capacity procured from other operators, often in frequencies not available on our network. Off-Network and Other Revenue also includes revenue from consulting and other services and sales of customer premises equipment.
Total On-Network Revenue reported a decline of
-
Transponder services reported a decline of
$36.1 million , primarily due to a$30.5 million decrease in revenue from network services customers and a$6.9 million decrease in revenue from media customers. The network services decline was mainly due to reduced volumes resulting from previously described non-renewals of certain point-to-point services, as well as lower prices on renewals of wireless infrastructure services and enterprise networks resulting from the competitive environment and the strengthening dollar inBrazil andRussia . The media decrease resulted in part from lower volumes due to certain North American customers migrating to new compression standards and single format distribution in the second quarter of 2015, partially offset by higher volumes of Direct-to-Home (“DTH”) services delivered inLatin America . -
Managed services reported an increase of
$2.0 million , primarily due to a$1.7 million increase in revenue from network services customers for broadband solutions. -
Channel reported a decline of
$9.6 million as a result of the continued migration of international point-to-point satellite traffic to fiber optic cable, a trend which we expect will continue.
Total Off-Network and Other Revenue reported an aggregate
decrease of
-
Transponder, MSS and other off-network services reported a
decline of
$0.4 million , primarily due to declines in services for government applications, largely related to reduced sales of off-network transponder services. -
Satellite-related services reported a decline of
$3.8 million , primarily due to decreased revenue from support for third-party satellites and other services.
For the three month period ended
Direct costs of revenue is expected to decrease by
Selling, general and administrative expenses is expected to
decrease by
Depreciation and amortization expense is expected to increase by
Interest expense, net consists of the interest expense we incur
together with gains and losses on interest rate swaps, which will
reflect net interest accrued on the interest rate swaps as well as the
change in their fair value, offset by interest income earned and the
amount of interest we capitalize related to assets under construction.
As of
The decrease in interest expense, net is principally due to the following:
-
a decrease of
$4.0 million in interest expense primarily as a result of our debt redemption in 2014; and -
a decrease of
$3.8 million resulting from higher capitalized interest of$22.7 million for the three months endedDecember 31, 2015 as compared to$18.9 million for the three month endedDecember 31, 2014 , resulting from increased levels of satellites and related assets under construction.
We expect the non-cash portion of total interest expense, net to be
Gain (loss) on early extinguishment of debt is expected to be a
Provision for income taxes is expected to be
Cash paid for income taxes, net of refunds, is expected to total
Preliminary EBITDA, Adjusted EBITDA, Net Income, Net Income per
Diluted Common Share attributable to
EBITDA is expected to be
Adjusted EBITDA is expected to be
Net income attributable to
Net income per diluted common share attributable to
Adjusted net income per diluted common share attributable to
Preliminary Revenue Comparison by Customer Set and Service Type ($ in thousands) |
||||||||||||||
By Customer Set | ||||||||||||||
Three Months Ended |
Three Months Ended |
|||||||||||||
2014 | 2015 | |||||||||||||
Network Services | $ | 284,056 | 46 | % | $ | 245,441 | 43 | % | ||||||
Media | 226,020 | 37 | % | 219,013 | 38 | % | ||||||||
Government | 99,733 | 16 | % | 100,226 | 18 | % | ||||||||
Other | 9,313 | 2 | % | 6,579 | 1 | % | ||||||||
$ | 619,122 | 100 | % | $ | 571,259 | 100 | % | |||||||
By Service Type | ||||||||||||||
Three Months Ended |
Three Months Ended |
|||||||||||||
2014 | 2015 | |||||||||||||
On-Network Revenues | ||||||||||||||
Transponder services | $ | 447,161 | 72 | % | $ | 411,026 | 72 | % | ||||||
Managed services | 101,680 | 16 | % | 103,699 | 18 | % | ||||||||
Channel services | 13,146 | 2 | % | 3,585 | 1 | % | ||||||||
Total on-network revenues |
561,987 | 91 | % | 518,310 | 91 | % | ||||||||
Off-Network and Other Revenues | ||||||||||||||
Transponder, MSS and other off-network services |
43,271 | 7 | % | 42,901 | 8 | % | ||||||||
Satellite-related services | 13,864 | 2 | % | 10,048 | 2 | % | ||||||||
Total off-network and other revenues | 57,135 | 9 | % | 52,949 | 9 | % | ||||||||
Total | $ | 619,122 | 100 | % | $ | 571,259 | 100 | % | ||||||
Free Cash Flow from (used in) Operations
Preliminary free cash flow used in operations1 is
Payments for satellites and other property and equipment during the
three months ended
Financial Outlook 2016
Today,
Revenue:
-
stable to a slight decline of 2 percent in our media business. Our
media business will benefit from new capacity scheduled to enter
service in the second and fourth quarters of 2016. This will be offset
by the annualization of declines experienced in the second half of
2015 due to migration to new compression technologies, in addition to
continuing currency pressures related to our business in
Brazil andRussia ; -
a decline in our network services business of 15 to 17 percent,
reflecting pricing pressure primarily in the
Latin America ,Europe andAfrica andMiddle East regions, continuing erosion of certain point-to-point services, and also continuing currency pressures related to our business inBrazil andRussia ; and - a decline in our government business of 4 to 7 percent, noting that revenue would be stable if not for the loss of the CSSC contract, the procurement process for which is currently under formal protest.
Adjusted EBITDA:
Capital Expenditures:
We expect capital expenditures ranges of:
-
2016:
$725 million to $800 million , consistent with prior guidance; -
2017:
$625 million to $700 million , a decrease of$125 million compared to prior guidance; and -
2018:
$425 million to $525 million , introduced today.
Capital expenditure guidance for 2016 through 2018 assumes investment in
ten satellites in the manufacturing and design phase, or recently
launched, during the Guidance Period. In addition, we have capacity on
three other satellites in development, including custom payloads being
built for us on two third-party satellites, which will not require
capital expenditure, as well as our Horizons 3e joint venture, which is
building a satellite for the
We are scheduled to launch three of our new Intelsat EpicNG high throughput satellites during the 2016 through 2018 Guidance Period, increasing our total transmission capacity. By the conclusion of the Guidance Period at the end of 2018, the net number of transponder equivalents is expected to increase by a compound annual growth rate (“CAGR”) of approximately 10 percent as a result of the satellites entering service during the Guidance Period.
Our capital expenditures guidance includes capitalized interest.
Prepayments: We do not expect further significant prepayments, and as a result will no longer provide guidance on this financial metric.
The annual classification of capital expenditure and prepayments could be affected by the timing of achievement of contract, satellite manufacturing, launch and other milestones.
There were no prepayments during the three months ended
Cash Taxes: Annual 2016 cash taxes are expected to total
approximately
- - - - - - - - - - - - - - - - - - - - - - - - - -
1In this release, financial measures are presented both in accordance with GAAP and also on a non-GAAP basis. Prior to the effect of any impairments, EBITDA, Adjusted EBITDA (or “AEBITDA”), free cash flow from (used in) operations, Adjusted net income per diluted common share and related margins included in this release are non-GAAP financial measures. Please see the consolidated financial information below for information reconciling non-GAAP financial measures to comparable GAAP financial measures.
Q4 2015 Quarterly Commentary
As previously announced,
Conference Call Information
About
Envision…Connect…Transform…with
Special Note Regarding Expected Financial Results:
We have not yet filed our Annual Report on Form 20-F for the year ended
Intelsat Safe Harbor Statement:
Statements in this news release and certain oral statements from time to time by representatives of the company constitute "forward-looking statements" that do not directly or exclusively relate to historical facts. When used in this earnings release, the words “may,” “will,” “might,” “should,” “expect,” “plan,” “anticipate,” “project,” “believe,” “estimate,” “predict,” “intend,” “potential,” “outlook,” and “continue,” and the negative of these terms, and other similar expressions are intended to identify forward-looking statements and information. Forward-looking statements include: our expectation that we will incur an impairment charge that will result in a substantial reduction of our goodwill and other intangible assets; our expectation that the launches of our satellites in the future will position us for growth; our plans for satellite launches in the near to mid-term; our guidance regarding our expectations for our revenue performance and Adjusted EBITDA performance; our capital expenditure and customer prepayment guidance over the next several years; our expectations as to the increased number of transponder equivalents on our fleet over the next several years; and our expectations as to the level of our cash tax payments in the future.
The forward-looking statements reflect
Because actual results could differ materially from
INTELSAT S.A. UNAUDITED PRELIMINARY CONSOLIDATED STATEMENTS of OPERATIONS ($ in thousands, except per share amounts) |
||||||||||
Three Months
|
Three Months |
|||||||||
Revenue | $ | 619,122 | $ | 571,259 | ||||||
Operating expenses: | ||||||||||
Direct costs of revenue (excluding depreciation and amortization) | 93,212 | 85,163 | ||||||||
Selling, general and administrative | 61,896 | 44,152 | ||||||||
Depreciation and amortization | 171,307 | 173,667 | ||||||||
Total operating expenses, prior to the effect of any impairments | 326,415 | 302,982 | ||||||||
Income from operations, prior to the effect of any impairments | 292,707 | 268,277 | ||||||||
Interest expense, net | 230,216 | 220,751 | ||||||||
Gain (loss) on early extinguishment of debt | (40,423 | ) | 7,061 | |||||||
Other income (expense), net | (1,971 | ) | 1,592 | |||||||
Income before income taxes, prior to the effect of any impairments | 20,097 | 56,179 | ||||||||
Provision for income taxes | 2,877 | 6,100 | ||||||||
Net income, prior to the effect of any impairments | 17,220 | 50,079 | ||||||||
Net income attributable to noncontrolling interest, prior to the
effect |
(1,026 | ) | (985 | ) | ||||||
Net income attributable to Intelsat S.A., prior to the effect of
any |
$ | 16,194 | $ | 49,094 | ||||||
Cumulative preferred dividends | - | - | ||||||||
Net income attributable to common shareholders, prior to the
effect of |
$ | 16,194 | $ | 49,094 | ||||||
Net income per common share attributable to Intelsat S.A., prior
to the |
||||||||||
Basic | $ | 0.15 | $ | 0.46 | ||||||
Diluted | $ | 0.14 | $ | 0.42 | ||||||
INTELSAT S.A. CONSOLIDATED PRELIMINARY STATEMENTS of OPERATIONS ($ in thousands, except per share amounts) |
||||||||||
Year Ended |
Year Ended |
|||||||||
(unaudited) | ||||||||||
Revenue | $ | 2,472,386 | $ | 2,352,521 | ||||||
Operating expenses: | ||||||||||
Direct costs of revenue (excluding depreciation and amortization) | 348,348 | 328,501 | ||||||||
Selling, general and administrative | 197,407 | 199,412 | ||||||||
Depreciation and amortization | 679,351 | 687,729 | ||||||||
Total operating expenses, prior to the effect of any impairments | 1,225,106 | 1,215,642 | ||||||||
Income from operations, prior to the effect of any impairments | 1,247,280 | 1,136,879 | ||||||||
Interest expense, net | 944,787 | 890,279 | ||||||||
Gain (loss) on early extinguishment of debt | (40,423 | ) | 7,061 | |||||||
Other income (expense), net | (2,593 | ) | (6,201 | ) | ||||||
Income before income taxes, prior to the effect of any impairments | 259,477 | 247,460 | ||||||||
Provision for income taxes | 22,971 | 1,513 | ||||||||
Net income, prior to the effect of any impairments | 236,506 | 245,947 | ||||||||
Net income attributable to noncontrolling interest, prior to the
effect |
(3,974 | ) | (3,934 | ) | ||||||
Net income attributable to Intelsat S.A., prior to the effect of
any |
$ | 232,532 | $ | 242,013 | ||||||
Cumulative preferred dividends | (9,917 | ) | (9,919 | ) | ||||||
Net income attributable to common shareholders, prior to the
effect of |
$ | 222,615 | $ | 232,094 | ||||||
Net income per common share attributable to Intelsat S.A., prior to |
||||||||||
Basic | $ | 2.09 | $ | 2.16 | ||||||
Diluted | $ | 1.99 | $ | 2.06 | ||||||
INTELSAT S.A. UNAUDITED PRELIMINARY RECONCILIATION OF NET INCOME TO EBITDA ($ in thousands) |
||||||||||||||||||||
Three Months Ended
December 31, 2014 |
Three Months Ended
December 31, 2015 |
Year Ended
December 31, 2014 |
Year Ended
December 31, 2015 |
|||||||||||||||||
Net income, prior to the effect of any impairments | $ | 17,220 | $ | 50,079 | $ | 236,506 | $ | 245,947 | ||||||||||||
Add (Subtract): | ||||||||||||||||||||
Interest expense, net | 230,216 | 220,751 | 944,787 | 890,279 | ||||||||||||||||
Loss (gain) on early extinguishment of debt | 40,423 | (7,061 | ) | 40,423 | (7,061 | ) | ||||||||||||||
Provision for income taxes | 2,877 | 6,100 | 22,971 | 1,513 | ||||||||||||||||
Depreciation and amortization | 171,307 | 173,667 | 679,351 | 687,729 | ||||||||||||||||
EBITDA, prior to the effect of any impairments | $ | 462,043 | $ | 443,536 | $ | 1,924,038 | $ | 1,818,407 | ||||||||||||
EBITDA Margin, prior to the effect of any |
75 | % | 78 | % | 78 | % | 77 | % | ||||||||||||
Note:
EBITDA is not a measure of financial performance under U.S. GAAP, and our EBITDA may not be comparable to similarly titled measures of other companies. EBITDA should not be considered as an alternative to operating income (loss) or net income (loss), determined in accordance with U.S. GAAP, as an indicator of our operating performance, or as an alternative to cash flows from operating activities, determined in accordance with U.S. GAAP, as an indicator of cash flows, or as a measure of liquidity.
The EBITDA and margin information presented above, with respect to the 2015 periods, is prior to the effect of any impairments.
INTELSAT S.A. UNAUDITED PRELIMINARY RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA ($ in thousands) |
||||||||||||||||||||
Three Months Ended |
Three Months Ended |
Year Ended |
Year Ended |
|||||||||||||||||
Net income, prior to the effect of any impairments | $ | 17,220 | $ | 50,079 | $ | 236,506 | $ | 245,947 | ||||||||||||
Add (Subtract): | ||||||||||||||||||||
Interest expense, net | 230,216 | 220,751 | 944,787 | 890,279 | ||||||||||||||||
Loss (gain) on early extinguishment of debt | 40,423 | (7,061 | ) | 40,423 | (7,061 | ) | ||||||||||||||
Provision for (benefit from) income taxes | 2,877 | 6,100 | 22,971 | 1,513 | ||||||||||||||||
Depreciation and amortization | 171,307 | 173,667 | 679,351 | 687,729 | ||||||||||||||||
EBITDA, prior to the effect of any impairments | 462,043 | 443,536 | 1,924,038 | 1,818,407 | ||||||||||||||||
Add: | ||||||||||||||||||||
Compensation and benefits | 8,786 | 4,827 | 22,921 | 26,235 | ||||||||||||||||
Non-recurring and other non-cash items | 6,295 | 4,258 | 11,723 | 9,877 | ||||||||||||||||
Adjusted EBITDA, prior to the effect of any |
$ | 477,124 | $ | 452,621 | $ | 1,958,682 | $ | 1,854,519 | ||||||||||||
Adjusted EBITDA Margin, prior to the effect of any |
77 | % | 79 | % | 79 | % | 79 | % | ||||||||||||
Note:
Adjusted EBITDA is not a measure of financial performance under U.S. GAAP and may not be comparable to similarly titled measures of other companies. Adjusted EBITDA should not be considered as an alternative to operating income (loss) or net income (loss), determined in accordance with U.S. GAAP, as an indicator of our operating performance, or as an alternative to cash flows from operating activities, determined in accordance with U.S. GAAP, as an indicator of cash flows, or as a measure of liquidity.
The Adjusted EBITDA and margin information presented above, with respect to the 2015 periods, is prior to the effect of any impairments.
INTELSAT S.A. UNAUDITED PRELIMINARY ADJUSTED NET INCOME per DILUTED COMMON SHARE ($ in thousands, except per share amounts) |
||||||||||||||||||||
Three Months |
Three Months |
Year Ended |
Year Ended |
|||||||||||||||||
Numerator (in thousands): | ||||||||||||||||||||
Net income attributable to Intelsat S.A., prior to the effect of
any |
$ | 16,194 | $ | 49,094 | $ | 232,532 | $ | 242,013 | ||||||||||||
Add (Subtract): | ||||||||||||||||||||
Compensation and benefits (1) | 8,786 | 4,827 | 22,921 | 26,235 | ||||||||||||||||
Losses on derivative financial instruments (2) | 1,709 | 32 | 5,649 | 3,483 | ||||||||||||||||
(Gain) loss on early extinguishment of debt | 40,423 | (7,061 | ) | 40,423 | (7,061 | ) | ||||||||||||||
Amortization (3) | 17,058 | 15,054 | 68,231 | 60,215 | ||||||||||||||||
Non-recurring and other non-cash items (4) | 6,295 | 4,258 | 11,723 | 9,877 | ||||||||||||||||
Income tax effect of adjustments above & other
discrete tax items (5) |
1,864 | (1,823 | ) | 3,126 | (6,597 | ) | ||||||||||||||
Adjusted net income attributable to Intelsat S.A., prior to the |
92,329 | 64,381 | 384,605 | 328,165 | ||||||||||||||||
Less: Preferred share dividends declared | - | - | (9,917 | ) | (9,919 | ) | ||||||||||||||
Adjusted net income attributable to common shareholders, prior |
$ | 92,329 | $ | 64,381 | $ | 374,688 | $ | 318,246 | ||||||||||||
Denominator (in millions): | ||||||||||||||||||||
Basic weighted average shares outstanding | 106.7 | 107.5 | 106.5 | 107.2 | ||||||||||||||||
Weighted average dilutive shares outstanding: | ||||||||||||||||||||
Preferred shares | 9.6 | 9.6 | 9.6 | 9.6 | ||||||||||||||||
Employee compensation related shares including options
|
0.8 | 0.6 | 0.5 | 0.4 | ||||||||||||||||
Adjusted diluted weighted average shares outstanding | 117.1 | 117.7 | 116.6 | 117.2 | ||||||||||||||||
Adjusted net income per diluted common share
|
$ | 0.79 | $ | 0.55 | $ | 3.30 | $ | 2.80 | ||||||||||||
Note: |
|||
|
Management evaluates financial performance in part based on adjusted net income per diluted common share attributable to common shareholders, prior to the effect of any impairments. This measure consists of net income per diluted common share attributable to common shareholders as reported, which is prior to the effect of any impairments, as adjusted to exclude or include certain unusual items, certain other operating expense items and certain other adjustments as described in the table and footnotes below. In addition, in calculating this measure we adjusted our common shares outstanding to reflect dilution when the calculation of the numerator moved from a net loss to net income, prior to the effect of any impairments. We believe investors’ understanding of our operating performance is enhanced by the disclosure of this measure. Adjusted net income per diluted common share attributable to common shareholders, prior to the effect of any impairments, is not a recognized financial measure in accordance with U.S. GAAP and should not be considered a substitute for earnings per share or other financial measures as computed in accordance with U.S. GAAP and may not be comparable to similarly titled measures of other companies. | ||
(1) |
Reflects non-cash expenses incurred relating to our equity compensation plans and a portion of the expenses related to our defined benefit retirement plan and other postretirement benefits. | ||
(2) |
Represents (i) the changes in the fair value of the undesignated interest rate swaps and (ii) the difference between the amount of floating rate interest we receive and the amount of fixed rate interest we pay under such swaps, both of which are recognized in interest expense, net. | ||
(3) |
Intangible assets are amortized based on the expected pattern of consumption. We recorded amortization expense related to our backlog and other and customer intangible assets. | ||
(4) |
Reflects certain non-recurring gains and losses and non-cash items, including the following: development expenses; non-recurring litigation expenses; non-cash expense related to the recognition of expense on a straight-line basis for certain office space leases; expenses associated with the relocation of our administrative headquarters and primary satellites operations center; severance, retention and relocation payments; and other various non-recurring expenses. These costs were partially offset by non-cash income related to the recognition of deferred revenue on a straight-line basis for certain prepaid capacity service contracts. | ||
(5) |
Represents the income tax impact of the various adjustments. | ||
INTELSAT S.A. CONSOLIDATED PRELIMINARY BALANCE SHEETS ($ in thousands, except per share amounts) |
||||||||||
As of |
As of |
|||||||||
(unaudited) | ||||||||||
ASSETS | ||||||||||
Current assets: | ||||||||||
Cash and cash equivalents | $ | 123,147 | $ | 171,541 | ||||||
Receivables, net of allowance of $35,174 in 2014 and $37,178 in 2015 | 220,458 | 232,775 | ||||||||
Deferred income taxes | 76,315 | - | ||||||||
Prepaid expenses and other current assets | 35,945 | 35,784 | ||||||||
Total current assets | 455,865 | 440,100 | ||||||||
Satellites and other property and equipment, net | 5,880,264 | 5,988,317 | ||||||||
Goodwill | 6,780,827 | 6,780,827 | ||||||||
Non-amortizable intangible assets | 2,458,100 | 2,458,100 | ||||||||
Amortizable intangible assets, net | 500,545 | 440,330 | ||||||||
Other assets | 250,833 | 311,316 | ||||||||
Total assets | $ | 16,326,434 | $ | 16,418,990 | ||||||
LIABILITIES AND SHAREHOLDERS' DEFICIT | ||||||||||
Current liabilities: | ||||||||||
Accounts payable and accrued liabilities | $ | 151,793 | $ | 164,381 | ||||||
Taxes payable | 8,974 | 11,742 | ||||||||
Employee related liabilities | 44,815 | 35,361 | ||||||||
Accrued interest payable | 161,495 | 161,493 | ||||||||
Current portion of long-term debt | 49,000 | - | ||||||||
Deferred satellite performance incentives | 20,957 | 19,411 | ||||||||
Deferred revenue | 117,401 | 108,779 | ||||||||
Other current liabilities | 72,629 | 63,275 | ||||||||
Total current liabilities | 627,064 | 564,442 | ||||||||
Long-term debt, net of current portion | 14,619,221 | 14,611,379 | ||||||||
Deferred satellite performance incentives, net of current portion | 163,360 | 162,177 | ||||||||
Deferred revenue, net of current portion | 967,318 | 1,010,242 | ||||||||
Deferred income taxes | 211,680 | 160,802 | ||||||||
Accrued retirement benefits | 262,906 | 195,385 | ||||||||
Other long-term liabilities | 217,452 | 169,516 | ||||||||
Commitments and contingencies | ||||||||||
Shareholders' deficit: | ||||||||||
Common shares; nominal value $0.01 per share | 1,067 | 1,076 | ||||||||
5.75% Series A mandatory convertible junior non-voting preferred
shares; nominal value $0.01 per |
35 | 35 | ||||||||
Paid-in capital | 2,117,898 | 2,133,891 | ||||||||
Accumulated deficit, prior to the effect of any impairments | (2,782,741 | ) | (2,540,728 | ) | ||||||
Accumulated other comprehensive loss | (112,527 | ) | (78,439 | ) | ||||||
Total Intelsat S.A. shareholders' deficit, prior to the effect of any impairments | (776,268 | ) | (484,165 | ) | ||||||
Noncontrolling interest | 33,701 | 29,212 | ||||||||
Total liabilities and shareholders' deficit, prior to the effect of any impairments | $ | 16,326,434 | $ | 16,418,990 | ||||||
INTELSAT S.A. UNAUDITED PRELIMINARY CONSOLIDATED STATEMENTS OF CASH FLOWS ($ in thousands) |
||||||||||||
Three Months Ended
December 31, 2014 |
Three Months Ended
December 31, 2015 |
Year Ended
December 31, 2014 |
Year Ended
December 31, 2015 |
|||||||||
Cash flows from operating activities: | ||||||||||||
Net income, prior to the effect of any impairments | $ 17,220 | $ 50,079 | $ 236,506 | $ 245,947 | ||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||
Depreciation and amortization | 171,307 | 173,668 | 679,351 | 687,729 | ||||||||
Provision for doubtful accounts | 5,151 | (4,901) | 2,306 | 7,432 | ||||||||
Foreign currency transaction (gain) loss | 3,139 | (593) | 6,560 | 11,374 | ||||||||
Loss on disposal of assets | 535 | 16 | 927 | 16 | ||||||||
Share-based compensation | 8,680 | 4,710 | 22,494 | 25,768 | ||||||||
Deferred income taxes | (10,165) | (2,676) | (12,646) | (9,348) | ||||||||
Amortization of discount, premium, issuance costs and related costs | 5,250 | 5,071 | 22,256 | 20,119 | ||||||||
(Gain) loss on early extinguishment of debt | 40,423 | (7,060) | 40,423 | (7,060) | ||||||||
Unrealized gains on derivative financial instruments | (5,459) | (6,649) | (22,790) | (24,024) | ||||||||
Amortization of actuarial loss and prior service credits for retirement benefits | 2,537 | 1,286 | 10,147 | 7,899 | ||||||||
Other non-cash items | 39 | 124 | 166 | 74 | ||||||||
Changes in operating assets and liabilities: | ||||||||||||
Receivables | (14,907) | (162) | 1,382 | (31,442) | ||||||||
Prepaid expenses and other assets | (6,461) | (13,992) | (22,331) | (20,780) | ||||||||
Accounts payable and accrued liabilities | 7,364 | 10,714 | 7,598 | 1,542 | ||||||||
Accrued interest payable | (167,230) | (149,906) | (24,997) | (2) | ||||||||
Deferred revenue | 38,017 | (11,189) | 108,545 | 51,805 | ||||||||
Accrued retirement benefits | (4,131) | (956) | (26,019) | (20,707) | ||||||||
Other long-term liabilities | 3,572 | (938) | 16,292 | (28,111) | ||||||||
Net cash provided by operating activities, prior to the effect of any impairments | 94,881 | 46,646 | 1,046,170 | 918,231 | ||||||||
Cash flows from investing activities: | ||||||||||||
Payments for satellites and other property and equipment (including capitalized interest) | (142,437) | (172,638) | (645,424) | (724,362) | ||||||||
Purchase of cost method investment | - | - | - | (25,000) | ||||||||
Other investing activities | - | (5,000) | 174 | (4,992) | ||||||||
Net cash used in investing activities | (142,437) | (177,638) | (645,250) | (754,354) | ||||||||
Cash flows from financing activities: | ||||||||||||
Repayments of long-term debt | (586,000) | (17,829) | (610,418) | (496,829) | ||||||||
Payment of premium on early extinguishment of debt | (21,250) | - | (21,250) | - | ||||||||
Proceeds from issuance of long-term debt | 135,000 | - | 135,000 | 430,000 | ||||||||
Dividends paid to preferred shareholders | (2,480) | (2,480) | (9,919) | (9,919) | ||||||||
Principal payments on deferred satellite performance incentives | (5,367) | (5,902) | (19,774) | (19,568) | ||||||||
Capital contribution from noncontrolling interest | - | - | 12,209 | - | ||||||||
Dividends paid to noncontrolling interest | (2,087) | (1,700) | (8,744) | (8,423) | ||||||||
Other financing activities | (7) | - | 3,893 | (1,447) | ||||||||
Net cash used in financing activities | (482,191) | (27,911) | (519,003) | (106,186) | ||||||||
Effect of exchange rate changes on cash and cash equivalents | (3,139) | 2,670 | (6,560) | (9,297) | ||||||||
Net change in cash and cash equivalents, prior to the effect of any impairments | (532,886) | (156,233) | (124,643) | 48,394 | ||||||||
Cash and cash equivalents, beginning of period | 656,033 | 327,774 | 247,790 | 123,147 | ||||||||
Cash and cash equivalents, end of period | $ 123,147 | $ 171,541 | $ 123,147 | $ 171,541 | ||||||||
Supplemental cash flow information: | ||||||||||||
Interest paid, net of amounts capitalized | $ 397,627 | $ 372,395 | $ 970,345 | $ 894,465 | ||||||||
Income taxes paid, net of refunds | 7,209 | 3,790 | 37,805 | 26,324 | ||||||||
Supplemental disclosure of non-cash investing activities: | ||||||||||||
Capitalization of deferred satellite performance incentives | $ 27,681 | $ 16,800 | $ 27,681 | $ 16,800 | ||||||||
Accrued capital expenditures | 21,690 | 66,228 | 80,621 | 82,208 | ||||||||
INTELSAT S.A. UNAUDITED PRELIMINARY RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW FROM (USED IN) OPERATIONS ($ in thousands) |
||||||||||||||||||||
Three Months Ended |
Three Months Ended |
Year Ended |
Year Ended |
|||||||||||||||||
Net cash provided by operating activities, prior to the |
$ | 94,881 | $ | 46,646 | $ | 1,046,170 | $ | 918,231 | ||||||||||||
Payments for satellites and other property
|
(142,437 | ) | (172,638 | ) | (645,424 | ) | (724,362 | ) | ||||||||||||
Free cash flow from (used in) operations, prior to the |
$ | (47,556 | ) | $ | (125,992 | ) | $ | 400,746 | $ | 193,869 | ||||||||||
Note:
Free cash flow from (used in) operations consists of net cash provided
by operating activities, less payments for satellites and other property
and equipment (including capitalized interest). Free cash flow from
(used in) operations excludes proceeds resulting from settlement of
insurance claims, and is not a measurement of cash flow under GAAP.
The free cash flow from (used in) operations information presented above, with respect to the 2015 periods, is prior to the effect of any impairments.
View source version on businesswire.com: http://www.businesswire.com/news/home/20160222005419/en/
Source:
Intelsat
Dianne VanBeber, +1 703-559-7406
Vice
President, Investor Relations and Corporate Communications
dianne.vanbeber@intelsat.com