|View printer-friendly version|
|Intelsat Reports Second Quarter 2013 Results|
“The Intelsat team is executing against our operational priorities for 2013. New business on video neighborhood satellites and on our broadband mobility infrastructure is driving on-network revenue growth in our network services and media businesses. Declines in our government business, due to the U.S. government budget sequestration and troop drawdowns, were reflected primarily in off-network revenues. Overall, revenue and Adjusted EBITDA grew at two percent and four percent, respectively, as compared to the second quarter of 2012.”
McGlade continued, “During the quarter, we furthered our commitment to
our next-generation fleet design, announcing manufacturing commitments
for four additional satellites to be deployed over the coming years as
we replace existing satellites with the innovative, high-throughput and
cost-efficient Intelsat EpicNG platform. Leading up to the
launch of those satellites, we are working with strategic customers to
create portfolios of services on the current fleet that satisfy today's
requirements while providing a bridge to our customers’ future growth
needs on EpicNG.
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 revenue for the three months ended
Off-Network and Other Revenue:
Changes in direct costs of revenue, selling, general and administrative expenses, depreciation and amortization, income from operations, interest expense, net, and other significant income-statement items are described below.
EBITDA, Adjusted EBITDA and Other Financial Metrics
Free Cash Flow From (Used in) Operations
Free cash flow used in operations1 was
Financial Outlook 2013 with Updated Prepayments Guidance
Consistent with prior guidance, for the full year 2013
As previously announced, our 2013 capital expenditure guidance for the
three calendar years 2013 through 2015 (the “Guidance Period”) assumes
investment in nine satellites in the manufacturing or design phase
during the Guidance Period, including one destroyed in a launch failure
Consistent with prior guidance, we expect our capital expenditures to
During the Guidance Period, we expect to receive significant customer
prepayments under our existing customer service contracts. In an effort
to balance our growth and delevering objectives, today we are updating
prepayment guidance to reflect only amounts currently contractually
committed. Significant prepayments are currently expected to range from
The annual classification of capital expenditure and prepayments could be affected by the timing of achievement of contract, satellite manufacturing, launch and other milestones.
- - - - - - - - - - - - - - - - - - -
1In this release, financial measures are presented both in accordance with GAAP and also on a non-GAAP basis. EBITDA, Adjusted EBITDA, free cash flow from (used in) operations 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.
Conference Call Information
Intelsat Safe Harbor Statement: Some of the statements in this news
release constitute "forward-looking statements" that do not directly or
exclusively relate to historical facts. The forward-looking statements
made in this release reflect
EBITDA consists of earnings before net interest, loss on early extinguishment of debt, taxes and depreciation and amortization. Given our high level of leverage, refinancing activities are a frequent part of our efforts to manage costs of borrowing. Accordingly, we consider (gain) loss on early extinguishment of debt an element of interest expense. EBITDA is a measure commonly used in the FSS sector, and we present EBITDA to enhance the understanding of our operating performance. We use EBITDA as one criterion for evaluating our performance relative to that of our peers. We believe that EBITDA is an operating performance measure, and not a liquidity measure, that provides investors and analysts with a measure of operating results unaffected by differences in capital structures, capital investment cycles and ages of related assets among otherwise comparable companies. However, 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.
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.
(1) Common shares and paid-in capital amounts reflect the retroactive impact of the Class A and Class B share reclassification into common shares and the share splits related to our Initial Public Offering.
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.