Viasat, Inc. · NASDAQ:VSAT
Viasat — Inmarsat — Q3 2018 Earnings Presentation
21 slides from Viasat's earnings presentation, Nov 8, 2018
Slide 1: Q3 2018 results
INMARSAT > Q3 2018 Results Q3 2018 results 8 November 2018
Slide 2: Performance review
INMARSAT > Q3 2018 Results Performance review Rupert Pearce Chief Executive Officer
Slide 3: Operational Review – Q3 2018
Operational Review – Q3 2018 Inmarsat’s diversified growth portfolio continues to drive improved results ˃ Robust growth - in Revenue and EBITDA from diversified growth portfolio ˃ Maritime - highly competitive market, as fast-growing VSAT segment develops – well-placed to win ˃ Government - strong
Slide 4: Maritime performance
Maritime – Q3 2018 performance Market remains highly competitive, as fast-growing VSAT segment develops – well-placed to win L-band Ka-band Fleet One Fleet BroadBand Fleet Xpress > c.4,000 > Rapid migration of vessels from mid- > 25% market share in VSAT today (2016: 15%) vessels market to VSAT (inc
Slide 5: Government performance
Government – Q3 2018 performance Strong growth performance, particularly from non-US business US International Higher underlying revenues from Increased product usage from key Boeing partnership customers – particularly in L-band New major customer win in Q3 - Continued success in further validation
Slide 6: Aviation performance
Aviation – Q3 2018 performance Material strategic, operational and financial progress Core business In-flight Connectivity > Higher customer usage in SwiftBroadband > 321 aircraft installed, including first for EAN > JetConneX achieving material market penetration in > Further increase in aircraft i
Slide 7: Aviation: Panasonic strategic partnership
Aviation: Panasonic strategic partnership Strengthens drive to create global leadership position in IFC Leading global mobile Market leader satellite provider in IFC and IFE Key benefits for Inmarsat > Exclusive provider of Ka-band IFC capacity to Panasonic > GX the priority service for all future P
Slide 8: Enterprise performance
Enterprise – Q3 2018 performance Best quarter so far this year, against tough comparator New growth foundations being established Legacy business performed well around “Internet-of-Things” > Strong performance in BGAN and satellite phones, > Further growth in M2M against tough comparator > Initial p
Slide 9: Diversified portfolio to drive Revenue, EBITDA and FCF growth
Diversified portfolio to drive Revenue, EBITDA and FCF growth Multiple paths to additional Ligado Double digit growth growth & value creation – Spectrum China & India off a solid base Digital services Govt Internet Strategic deals of Things & Op tempo In-Flight Connectivity GX & EAN Base Case High g
Slide 10: Financial Review
INMARSAT > Q3 2018 Results Financial Review Tony Bates Chief Financial Officer
Slide 11: Group Income statement – Q3 and YTD 2018
Group Income statement – Q3 and YTD 2018 $m Q3 2018 Q3 2017 Change YTD 2018 YTD 2017 Change Revenue 369.3 356.2 13.1 1,086.5 1,039.9 46.6 Direct costs (61.4) (47.2) (14.2) (179.6) (133.7) (45.9) Gross margin 307.9 309.0 (1.1) 906.9 906.2 0.7 Indirect costs (101.4) (115.7) 14.3 (327.4) (333.2) 5.8 EB
Slide 12: Business Unit Summary
Business Unit Summary – Q3 2018 Maritime ($m) 2018 2017 Government ($m) 2018 2017 Aviation - IFC ($m) 2018 2017 Revenue 135.0 143.1 Revenue 95.2 88.4 Revenue 26.2 18.6 Direct Costs (17.8) (19.7) Direct Costs (14.9) (12.4) Direct Costs (15.8) (5.8) Gross Margin 117.2 86.8% 123.4 86.2% Gross Margin 80
Slide 13: Maritime Results
Maritime Results – Q3 2018 ˃ VSAT revenue up $7.3m, 23.0%, to $39.0m Q3 Revenue ($ in millions) − Market share gains continue − Vessels up 1,812 to 5,772 1.3 23.5 1.7 19.4 − ARPU impacted by channel mix and market capture strategy 2017 2018 ˃ FleetBroadband revenue down $11.6m, 13.4%, to $75.0m 31.7
Slide 14: Government Results
Government Results – Q3 2018 $m ˃ US revenue up 1.5%: 100 − Large contract renewed on more favourable terms earlier in 2018 90 95.2 ˃ Revenue up 21.1% outside the US: 80 88.4 − Increased product usage across key customers 70 69.9 ˃ Slightly lower Gross Margin % (due to mix) but lower indirect costs
Slide 15: Aviation Results Q3 2018
Aviation Results Q3 2018 ˃ Aviation revenue up $17.3m, 34.0%, to $68.2m $m ˃ Core revenues up $9.7m, 30.0%, to $42.0m 50 − SwiftBroadband up 9.4% − JetConneX up by factor of 4x 40 42.0 39.4 − Classic Aero up 16.9% 30 32.3 ˃ IFC revenues up $7.6m, 40.9%, to $26.2m 29.2 − Including $3.3m of GX airtime
Slide 16: Enterprise Results
Enterprise Results – Q3 2018 Q3 Revenue ($ in millions) ˃ Revenue down $3.6m, 9.4%, to $34.6m BGAN − Best quarter in 2018 GSPS − Tough 2017 comparator (due to hurricane activity) 8.3 8.5 7.0 7.4 F2M ˃ BGAN down 12.9% to $7.4m, Satellite phones down Other FB 4.6 2017 2018 5.5 7.1% to $10.4m M2M 1.4 1
Slide 17: Group Cash Flow – Q3 & YTD 2018
Group Cash Flow – Q3 & YTD 2018 US$m Q3 2018 Q3 2017 Change YTD 2018 YTD 2017 Change EBITDA 206.5 193.3 13.2 579.5 573.0 6.5 Working capital/non-cash items 3.2 (5.6) 8.8 (58.4) 16.4 (74.8) Operating cash flow 209.7 187.7 22.0 521.1 589.4 (68.3) Capital expenditure (157.5) (101.0) (56.5) (415.3) (409
Slide 18: Capital Expenditure – Q3 and YTD 2018
Capital Expenditure – Q3 and YTD 2018 US$m Q3 2018 Q3 2017 Change YTD 2018 YTD 2017 Change Major infrastructure projects 88.1 40.7 (47.4) 225.8 244.2 18.4 Success-based capex 16.2 32.2 16.0 61.3 93.0 31.7 Other 20.8 36.3 15.5 68.3 95.1 26.8 Cash flow timing 32.4 (8.2) (40.6) 59.9 (23.1) (83.0) Total
Slide 19: Future Guidance
Future Guidance Medium term guidance unchanged, updated revenue & EBITDA guidance for 2018 2018 Revenue & EBITDA GX revenues: Capex: (excluding Ligado): > Annual GX revenues at a run rate of > Capex of $500m to $600m pa over > Expected to be at least in line with $500m by the end of 2020 2018 to 202
Slide 20: Q&A
INMARSAT > Q3 2018 Results Q&A
Slide 21: Disclaimer
Disclaimer These materials have been prepared by or on behalf of Inmarsat plc and its affiliates (“Inmarsat”, “we”, “us” or our”). The information provided within these materials, together with all or any other information relating to Inmarsat whether written, oral or in a visual or an electronic fo