CARLSBAD, Calif., Nov. 6, 2012 /PRNewswire/ -- ViaSat Inc.
(NASDAQ: VSAT), an innovator in satellite and other wireless
networking systems and services, announced financial results for
the second quarter of fiscal year 2013. The fiscal second quarter
results include record new contract awards and revenues of
$548.0 million and $282.8 million, respectively, Adjusted EBITDA of
$44.6 million and a net loss
attributable to ViaSat common stockholders of $0.04 per share on a non-GAAP diluted basis or
$0.18 per share on a diluted GAAP
basis. Year-to-date, ViaSat reported new contract awards and
revenues of $880.6 million and
$524.6 million, respectively,
Adjusted EBITDA of $74.1 million and
a net loss attributable to ViaSat common stockholders of
$0.22 per share on a non-GAAP diluted
basis or $0.51 per share on a diluted
GAAP basis.
(Logo:
http://photos.prnewswire.com/prnh/20091216/VIASATLOGO)
"Our second quarter results vividly illustrate the growth and
earnings potential of the markets we've been developing the last
several years," said Mark Dankberg,
chairman and CEO of ViaSat. "New orders increased over 120%,
revenues by 27%, and Adjusted EBITDA by 14% compared to the same
period last year. The government segment grew revenues 25%,
operating earnings by 70%, and Adjusted EBITDA by 51% compared to
last year's second quarter, while booking over $170 million in new orders despite a very
challenging defense budget environment. Consumer broadband
subscriber growth continues to outpace the total broadband market,
and contributed to a $15 million
quarter-over-quarter gain in Adjusted EBITDA. Within satellite
services, sequential revenue growth of $8
million yielded about $5
million in Adjusted EBITDA growth, highlighting the path to
the investment returns we've been targeting for ViaSat-1."
Financial Results1
(In millions, except per share data)
|
Q2 FY13
|
Q2
FY12
|
First 6
Mos. FY13
|
First 6
Mos. FY12
|
Revenues
|
$282.8
|
$223.0
|
$524.6
|
$418.1
|
Adjusted EBITDA2
|
$44.6
|
$39.0
|
$74.1
|
$75.1
|
Net (loss) income3
|
($7.9)
|
$8.0
|
($22.3)
|
$9.7
|
Diluted per share net (loss) income
3
|
($0.18)
|
$0.18
|
($0.51)
|
$0.22
|
Non-GAAP net (loss) income 3,4
|
($1.9)
|
$13.9
|
($9.7)
|
$21.1
|
Non-GAAP diluted per share net (loss) income
3,4
|
($0.04)
|
$0.32
|
($0.22)
|
$0.48
|
Fully diluted weighted average shares
5
|
43.6
|
43.9
|
43.4
|
43.9
|
|
|
|
|
|
New contract awards
|
$548.0
|
$245.7
|
$880.6
|
$499.3
|
Sales backlog6
|
$965.8
|
$575.4
|
$965.8
|
$575.4
|
|
|
1
|
ViaSat
uses a 52 or 53 week fiscal year which ends on the Friday closest
to March 31. ViaSat quarters for fiscal year 2013 end on
June 29, 2012, September 28, 2012, December 28, 2012, and March 29,
2013.
|
|
|
2
|
Adjusted
EBITDA represents net income (loss) attributable to ViaSat Inc.
before interest, taxes, depreciation and amortization, adjusted to
exclude the effects of non-cash stock-based compensation expense
and acquisition related expenses. A reconciliation of specific
adjustments to GAAP results for these periods is included in the
tables below.
|
|
|
3
|
Attributable to ViaSat Inc. common
stockholders.
|
|
|
4
|
All
non-GAAP net income (loss) numbers have been adjusted to exclude
the effects of amortization of acquired intangible assets,
acquisition related expenses, and non-cash stock-based compensation
expenses, net of tax. A reconciliation of specific adjustments to
GAAP results for these periods is included in the tables
below.
|
|
|
5
|
As the
second quarter and first six months of fiscal year 2013 financial
information results in a net loss, the weighted average number of
shares used to calculate basic and diluted net loss per share is
the same, as diluted shares would be anti-dilutive.
|
|
|
6
|
Amounts
include certain backlog adjustments due to contract changes and
amendments.
|
Segment Results
(In
millions)
|
Q2
FY13
|
Q2
FY12
|
First 6
Mos. FY13
|
First 6
Mos. FY12
|
Satellite Services
|
|
|
|
|
New contract awards
|
$67.1
|
$55.4
|
$141.1
|
$111.8
|
Revenues
|
$67.3
|
$55.4
|
$126.6
|
$112.3
|
Adjusted EBITDA
|
$8.7
|
$16.8
|
$13.1
|
$37.6
|
|
|
|
|
|
Commercial Networks
|
|
|
|
|
New contract awards
|
$307.2
|
$53.6
|
$371.9
|
$165.8
|
Revenues
|
$86.5
|
$64.2
|
$162.7
|
$116.3
|
Adjusted EBITDA
|
$4.7
|
$1.8
|
$8.4
|
$3.4
|
|
|
|
|
|
Government Systems
|
|
|
|
|
New contract awards
|
$173.7
|
$136.7
|
$367.6
|
$221.7
|
Revenues
|
$129.0
|
$103.4
|
$235.3
|
$189.6
|
Adjusted EBITDA
|
$31.2
|
$20.6
|
$52.7
|
$34.2
|
Satellite Services revenues increased for the quarter and
year-to-date as our total subscriber base expanded to 429,000 and
the value of a higher mix of retail subscribers and the related
average revenue per user (ARPU) drove growth. Satellite Services
Adjusted EBITDA declined for the quarter and year-to-date compared
to last year as the incremental margins gained through subscriber
growth do not yet cover the fixed cost increases we undertook due
to the ViaSat-1 satellite. Commercial Networks revenues and
Adjusted EBITDA increased for the quarter and year-to-date as
satellite terminal sales and Ka-band network development revenues
grew as global demand for Ka-band satellite networks and services
expanded. Government Systems revenues and Adjusted EBITDA improved
in the second quarter and year-to-date as our government mobile
broadband products and services, command and control and tactical
satellite networks revenues and associated earnings overcame
reductions in information assurance product sales.
Selected Fiscal Second Quarter Business Highlights
- For the second quarter, our consumer Internet service reported
the following metrics:
- Ending subscribers: 429,000 (34.7% on ViaSat-1)
- Gross adds: 54,835
- Migrations from WildBlue® to Exede® service: 16,432
- Total new service installations (gross adds and migrations):
71,267
- Net new subscribers: 24,100
- Average monthly churn: 2.5%
- Weighted ARPU: $47.96
- Received 10,000+ order for SurfBeam® 2 broadband
terminals for Eutelsat's KA-SAT from an Eastern European election
agency.
- Received $34 million Lot 13 award
for MIDS-LVT terminals.
- Began work on satellite infrastructure system for the NBN Co
Australian national broadband network, which includes the
ground-based communications, network management, and data
processing systems.
- Won several awards in our Comsat Labs group to develop new
products and technologies for future protected military satcom
systems for the Department of Defense.
- Received $15 million in orders
for in-line network encryptor products.
- Subsequent to the quarter end, on October 12, 2012, we issued an additional
$300.0 million in aggregate principal
amount of our 6.875% Senior Notes due 2020. The net proceeds from
the notes offering are being used primarily to repurchase our
outstanding 8.875% Senior Notes due 2016 pursuant to a cash tender
offer and redemption.
- Contracted with American Red Cross Disaster Services to use
portable Exede Enterprise satellite services to establish
communications in areas with no cell connections or vehicle access
for site command and control, live video and imagery, and two-way
information sharing. The Red Cross successfully deployed these
mobile terminals in support of Hurricane Sandy disaster
relief.
- Reached wholesale distribution agreement with a service
provider in Latin America for
bandwidth to extend Ka-band satellite Internet access into northern
Mexico.
Safe Harbor Statement
This press release contains forward-looking statements that are
subject to the safe harbors created under the Securities Act of
1933 and the Securities Exchange Act of 1934. Forward-looking
statements include, among others, statements that refer to the
growth and earnings potential of our markets and our financial
results being on target. Readers are cautioned that actual results
could differ materially from those expressed in any forward-looking
statements. Factors that could cause actual results to differ
include: our ability to successfully implement our business plan
for our broadband satellite services on our anticipated timeline or
at all; negative audits by the U.S. government; continued turmoil
in the global business environment and economic conditions; delays
in approving U.S. government budgets and cuts in government defense
expenditures; our reliance on U.S. government contracts, and on a
small number of contracts which account for a significant
percentage of our revenues; our ability to successfully develop,
introduce and sell new technologies, products and services; reduced
demand for products as a result of continued constraints on capital
spending by customers; changes in relationships with, or the
financial condition of, key customers or suppliers; our reliance on
a limited number of third parties to manufacture and supply our
products; increased competition and other factors affecting the
communications and defense industries generally; the effect of
adverse regulatory changes on our ability to sell products and
services; our level of indebtedness and ability to comply with
applicable debt covenants; our involvement in litigation, including
intellectual property claims and litigation to protect our
proprietary technology; and our dependence on a limited number of
key employees. In addition, please refer to the risk factors
contained in our SEC filings available at www.sec.gov, including
our most recent Annual Report on Form 10-K and Quarterly Reports on
Form 10-Q. Readers are cautioned not to place undue reliance on any
forward-looking statements, which speak only as of the date on
which they are made. We undertake no obligation to update or revise
any forward-looking statements for any reason.
Conference Call
ViaSat Inc. will host a conference call to discuss the fiscal
year 2013 second quarter results at 5:00
p.m. Eastern Time on Tuesday,
November 6, 2012. The dial-in number is (877) 640-9809 in
the U.S. and (914) 495-8528 internationally. A replay of the
conference call will be available from 8:00
p.m. Eastern Time on Tuesday,
November 6 until midnight on Wednesday, November 7 by dialing (855) 859-2056
for U.S. callers and (404) 537-3406 for international callers, and
entering the conference ID 59115945. You can also access our
conference call webcast and other material financial information
discussed on our conference call on the Investor Relations section
of our website at investors.viasat.com. The call will be archived
and available on that site for approximately one month immediately
following the conference call.
About ViaSat (www.viasat.com)
ViaSat delivers fast, secure communications, Internet, and
network access to virtually any location for consumers,
governments, enterprise, and the military. The company offers fixed
and mobile satellite network services including Exede by ViaSat,
which features ViaSat-1, the world's highest capacity satellite;
service to more than 1,750 mobile platforms, including Yonder®
Ku-band mobile Internet; satellite broadband networking systems;
and network-centric military communication systems and cyber
security products for the U.S. and allied governments. ViaSat also
offers communication system design and a number of complementary
products and technologies. Based in Carlsbad, California, ViaSat has established a
number of worldwide locations for customer service, network
operations, and technology development.
Use of Non-GAAP Financial Information
To supplement ViaSat's consolidated financial statements
presented in accordance with generally accepted accounting
principles (GAAP), ViaSat uses non-GAAP net income (loss)
attributable to ViaSat Inc. and Adjusted EBITDA, measures ViaSat
believes are appropriate to enhance an overall understanding of
ViaSat's past financial performance and prospects for the future.
We believe the non-GAAP results provide useful information to both
management and investors by excluding specific expenses that we
believe are not indicative of our core operating results. In
addition, since we have historically reported non-GAAP results to
the investment community, we believe the inclusion of non-GAAP
numbers provides consistency in our financial reporting and
facilitates comparisons to the company's historical operating
results. Further, these non-GAAP results are among the primary
indicators that management uses as a basis for evaluating the
operating performance of our segments, allocating resources to such
segments, planning and forecasting in future periods. The
presentation of this additional information is not meant to be
considered in isolation or as a substitute for measures of
financial performance prepared in accordance with GAAP. A
reconciliation of specific adjustments to GAAP results is provided
in the tables below.
WildBlue, Exede, SurfBeam and Yonder are registered trademarks
and service marks of ViaSat, Inc.
Condensed Consolidated Statement of
Operations
|
(Unaudited)
|
(In
thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
Three
months ended
|
|
Six
months ended
|
|
September 28,
2012
|
|
September 30,
2011
|
|
September 28,
2012
|
|
September 30,
2011
|
|
|
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
|
|
Product
revenues
|
$
168,475
|
|
$
146,611
|
|
$
316,204
|
|
$
269,157
|
Service
revenues
|
114,347
|
|
76,413
|
|
208,381
|
|
148,968
|
Total
revenues
|
282,822
|
|
223,024
|
|
524,585
|
|
418,125
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
Cost of
product revenues
|
121,421
|
|
107,909
|
|
230,470
|
|
200,194
|
Cost of
service revenues
|
95,382
|
|
54,204
|
|
173,951
|
|
103,520
|
Selling,
general and administrative
|
54,079
|
|
44,379
|
|
110,580
|
|
86,112
|
Independent research and development
|
8,758
|
|
6,809
|
|
16,127
|
|
12,503
|
Amortization of acquired intangible assets
|
4,041
|
|
4,767
|
|
8,105
|
|
9,539
|
(Loss)
income from operations
|
(859)
|
|
4,956
|
|
(14,648)
|
|
6,257
|
Interest
expense, net
|
(11,508)
|
|
(198)
|
|
(22,994)
|
|
(172)
|
(Loss)
income before income taxes
|
(12,367)
|
|
4,758
|
|
(37,642)
|
|
6,085
|
Benefit
from income taxes
|
(4,510)
|
|
(3,411)
|
|
(15,352)
|
|
(3,678)
|
Net (loss)
income
|
(7,857)
|
|
8,169
|
|
(22,290)
|
|
9,763
|
Less: Net
income attributable to the noncontrolling interest, net of
tax
|
50
|
|
194
|
|
37
|
|
29
|
Net (loss)
income attributable to ViaSat Inc.
|
$
(7,907)
|
|
$
7,975
|
|
$
(22,327)
|
|
$
9,734
|
|
|
|
|
|
|
|
|
Diluted
net (loss) income per share attributable to ViaSat Inc. common
stockholders
|
$
(0.18)
|
|
$
0.18
|
|
$
(0.51)
|
|
$
0.22
|
Diluted
common equivalent shares
|
43,615
|
|
43,894
|
|
43,399
|
|
43,860
|
|
|
|
|
|
|
|
|
AN
ITEMIZED RECONCILIATION BETWEEN NET INCOME (LOSS) ATTRIBUTABLE TO
VIASAT INC.
|
|
|
|
|
ON A
GAAP BASIS AND NON-GAAP BASIS IS AS FOLLOWS:
|
|
|
|
|
|
|
|
Three
months ended
|
|
Six
months ended
|
|
September 28, 2012
|
|
September 30, 2011
|
|
September 28, 2012
|
|
September 30, 2011
|
|
|
|
|
|
|
|
|
GAAP net
(loss) income attributable to ViaSat Inc.
|
$
(7,907)
|
|
$
7,975
|
|
$
(22,327)
|
|
$
9,734
|
Amortization of acquired intangible assets
|
4,041
|
|
4,767
|
|
8,105
|
|
9,539
|
Stock-based compensation expense
|
5,805
|
|
4,804
|
|
12,424
|
|
8,979
|
Income tax
effect
|
(3,808)
|
|
(3,688)
|
|
(7,900)
|
|
(7,160)
|
Non-GAAP
net (loss) income attributable to ViaSat Inc.
|
$
(1,869)
|
|
$
13,858
|
|
$
(9,698)
|
|
$
21,092
|
Non-GAAP
diluted net (loss) income per share attributable to ViaSat Inc.
common stockholders
|
$
(0.04)
|
|
$
0.32
|
|
$
(0.22)
|
|
$
0.48
|
Diluted
common equivalent shares
|
43,615
|
|
43,894
|
|
43,399
|
|
43,860
|
|
|
|
|
|
|
|
|
AN
ITEMIZED RECONCILIATION BETWEEN NET INCOME (LOSS) ATTRIBUTABLE TO
VIASAT INC.
|
|
|
|
|
AND
ADJUSTED EBITDA IS AS FOLLOWS:
|
|
|
|
|
|
|
|
|
Three
months ended
|
|
Six
months ended
|
|
September 28, 2012
|
|
September 30, 2011
|
|
September 28, 2012
|
|
September 30, 2011
|
|
|
|
|
|
|
|
|
GAAP net
(loss) income attributable to ViaSat Inc.
|
$
(7,907)
|
|
$
7,975
|
|
$
(22,327)
|
|
$
9,734
|
Benefit
from income taxes
|
(4,510)
|
|
(3,411)
|
|
(15,352)
|
|
(3,678)
|
Interest
expense, net
|
11,508
|
|
198
|
|
22,994
|
|
172
|
Depreciation and amortization
|
39,676
|
|
29,426
|
|
76,393
|
|
59,907
|
Stock-based compensation expense
|
5,805
|
|
4,804
|
|
12,424
|
|
8,979
|
Adjusted
EBITDA
|
$
44,572
|
|
$
38,992
|
|
$
74,132
|
|
$
75,114
|
|
|
|
|
|
|
|
|
|
|
|
AN
ITEMIZED RECONCILIATION BETWEEN SEGMENT OPERATING PROFIT (LOSS)
BEFORE
|
CORPORATE AND AMORTIZATION OF ACQUIRED INTANGIBLE
ASSETS AND ADJUSTED EBITDA IS AS FOLLOWS:
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
months ended September 28, 2012
|
|
Three
months ended September 30, 2011
|
|
|
|
Satellite Services
|
|
Commercial Networks
|
|
Government Systems
|
|
Total
|
|
Satellite Services
|
|
Commercial Networks
|
|
Government Systems
|
|
Total
|
|
Segment
operating (loss) profit before corporate and amortization of
acquired intangible assets
|
|
$
(19,373)
|
|
$
(1,836)
|
|
$
24,391
|
|
$
3,182
|
|
$
(1,739)
|
|
$
(2,871)
|
|
$
14,333
|
|
$
9,723
|
|
Depreciation *
|
|
26,045
|
|
2,870
|
|
4,290
|
|
33,205
|
|
16,974
|
|
2,549
|
|
4,105
|
|
23,628
|
|
Stock-based compensation expense
|
|
1,305
|
|
2,095
|
|
2,405
|
|
5,805
|
|
975
|
|
1,649
|
|
2,180
|
|
4,804
|
|
Other
amortization
|
|
703
|
|
1,617
|
|
88
|
|
2,408
|
|
560
|
|
462
|
|
-
|
|
1,022
|
|
Adjusted
EBITDA before other
|
|
$
8,680
|
|
$
4,746
|
|
$
31,174
|
|
44,600
|
|
$
16,770
|
|
$
1,789
|
|
$
20,618
|
|
39,177
|
|
Other
|
|
|
|
|
|
|
|
(28)
|
|
|
|
|
|
|
|
(185)
|
|
Adjusted
EBITDA
|
|
|
|
|
|
|
|
$
44,572
|
|
|
|
|
|
|
|
$
38,992
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six
months ended September 28, 2012
|
|
Six
months ended September 30, 2011
|
|
|
|
Satellite Services
|
|
Commercial Networks
|
|
Government Systems
|
|
Total
|
|
Satellite Services
|
|
Commercial Networks
|
|
Government Systems
|
|
Total
|
|
Segment
operating (loss) profit before corporate and amortization of
acquired intangible assets
|
|
$
(41,889)
|
|
$
(3,905)
|
|
$
39,251
|
|
$
(6,543)
|
|
$
194
|
|
$
(6,111)
|
|
$
21,713
|
|
$
15,796
|
|
Depreciation *
|
|
50,598
|
|
5,625
|
|
8,136
|
|
64,359
|
|
34,804
|
|
5,013
|
|
8,183
|
|
48,000
|
|
Stock-based compensation expense
|
|
2,633
|
|
4,612
|
|
5,179
|
|
12,424
|
|
1,947
|
|
2,709
|
|
4,323
|
|
8,979
|
|
Other
amortization
|
|
1,728
|
|
2,075
|
|
88
|
|
3,891
|
|
604
|
|
1,763
|
|
-
|
|
2,367
|
|
Adjusted
EBITDA before other
|
|
$
13,070
|
|
$
8,407
|
|
$
52,654
|
|
74,131
|
|
$
37,549
|
|
$
3,374
|
|
$
34,219
|
|
75,142
|
|
Other
|
|
|
|
|
|
|
|
1
|
|
|
|
|
|
|
|
(28)
|
|
Adjusted
EBITDA
|
|
|
|
|
|
|
|
$
74,132
|
|
|
|
|
|
|
|
$
75,114
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*
Depreciation expenses not specifically recorded in a particular
segment have been allocated based on sales, which management
believes is a reasonable method.
|
|
|
|
|
Condensed Consolidated Balance
Sheet
|
(Unaudited)
|
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
As
of
|
|
As
of
|
|
|
|
As
of
|
|
As
of
|
Assets
|
September 28, 2012
|
|
March
30, 2012
|
|
Liabilities and Equity
|
|
September 28, 2012
|
|
March
30, 2012
|
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Cash and
cash equivalents
|
$
136,118
|
|
$
172,583
|
|
Accounts
payable
|
|
$
80,646
|
|
$
75,040
|
Accounts
receivable, net
|
231,606
|
|
211,690
|
|
Accrued
liabilities
|
|
154,406
|
|
159,762
|
Inventories
|
132,890
|
|
127,646
|
|
Current
portion of other long-term debt
|
|
1,270
|
|
1,240
|
Deferred
income taxes
|
20,291
|
|
20,316
|
|
Total
current liabilities
|
|
236,322
|
|
236,042
|
Prepaid
expenses and other current assets
|
34,718
|
|
30,917
|
|
Senior
Notes, net
|
|
548,039
|
|
547,791
|
Total
current assets
|
555,623
|
|
563,152
|
|
Other
long-term debt
|
|
131
|
|
774
|
|
|
|
|
|
Other
liabilities
|
|
57,060
|
|
50,353
|
Property,
equipment and satellites, net
|
886,566
|
|
880,704
|
|
Total
liabilities
|
|
841,552
|
|
834,960
|
Other
acquired intangible assets, net
|
55,059
|
|
63,041
|
|
Total
ViaSat Inc. stockholders' equity
|
|
897,562
|
|
887,975
|
Goodwill
|
83,537
|
|
83,461
|
|
Noncontrolling interest in subsidiary
|
|
4,255
|
|
4,218
|
Other
assets
|
162,584
|
|
136,795
|
|
Total
equity
|
|
901,817
|
|
892,193
|
Total
assets
|
$
1,743,369
|
|
$
1,727,153
|
|
Total
liabilities and equity
|
|
$
1,743,369
|
|
$
1,727,153
|
|
|
|
|
|
|
|
|
|
|
SOURCE ViaSat Inc.