Gogo Inc. · NASDAQ:GOGO
Gogo — Investor Presentation (November 2015)
33 slides from Gogo's investor presentation, Nov 10, 2015
Slide 1: Investor Presentation
November 10, 2015 Investor Presentation Exhibit 99.1
Slide 2: Safe Harbor Statement
SAFE HARBOR STATEMENT This presentation contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 that are based on management’s beliefs and assumptions and on information currently available to manage
Slide 3: Agenda
AGENDA GOGOAIR.COM | On the Move Strategy Going Forward Key Differentiators Gogo Commercial Aviation Business Aviation
Slide 4: Delivering Next Generation Connectivity
ATG / ATG4 launched IFC in North America in 2008 2Ku - the catalyst for changing global aviation in 2015 It’s now global and about the crew and the aircraft in addition to the passenger DELIVERING NEXT GENERATION CONNECTIVITY ATG ATG4 2008 2012 2015 2018e 1st Generation 2nd Generation 3rd Generation
Slide 5: Growth and Profitability Trends Are Strong
GROWTH AND PROFITABILITY TRENDS ARE STRONG Note: Minor differences exist due to rounding (1) Please see reconciliation of Adjusted EBITDA in appendix Adjusted EBITDA(1) ($MM) $49 CA-ROW Segment Loss Revenue ($MM) 37% CAGR $89 Adjusted EBITDA $109 $24 GOGOAIR.COM |
Slide 6: Gogo Has the Most Broadband Aircraft Online
GOGO HAS THE MOST BROADBAND AIRCRAFT ONLINE Global Eagle Panasonic Others Gogo Broadband Aircraft Online Gogo BA Aircraft Online Gogo CA Aircraft Online GOGOAIR.COM | * Data based on management estimates, trade publications and other public sources as of 9/30/2015 and include both commercial and bus
Slide 7: Global Leader with Premier Partners
GLOBAL LEADER WITH PREMIER PARTNERS Business Segment Market Position Worldwide % of Q3’15 LTM Revenue Customers Include Commercial Aviation – North America #1 2,312 installed aircraft 62% 36% 2% Business Aviation #1 3,314 installed ATG aircraft #2 160 installed aircraft Commercial Aviation – Rest of
Slide 8: Agenda
AGENDA On the Move Strategy Going Forward Key Differentiators Gogo Commercial Aviation Business Aviation GOGOAIR.COM |
Slide 9: Differentiator #1: Mastering Aviation and Telecom Intersection
DIFFERENTIATOR #1 WE UNIQUELY MASTER THE COMPLEX INTERSECTION OF AVIATION & TELECOM Aviation Regulatory Environment End-to-End Telecom Service Provider Aviation Global Logistics Aviation Engineering Requirements Only Gogo masters all four requirements GOGOAIR.COM |
Slide 10: Differentiator #2: 2Ku Is a Global Broadband Highway in the Sky
DIFFERENTIATOR #2 2Ku IS A TRULY GLOBAL BROADBAND HIGHWAY IN THE SKY Coverage: Near global coverage Aero performance: Low profile, low fuel burn Cost: Most cost efficient globally Capacity: ~180 Ku satellites; HTS satellites coming Reliability: Fewer moving parts, satellite redundancy Adapter Plate
Slide 11: Differentiator #3: Delivering More Value to Aviation Partners
DIFFERENTIATOR #3 DELIVERING MORE VALUE TO AVIATION PARTNERS Improved operations Better decision making with Electronic flight bag, real-time weather/flight routing, aircraft health monitoring, predictive maintenance, etc. Digitized front line employees More efficient crew and improved passenger exp
Slide 12: Agenda
AGENDA On the Move Strategy Going Forward Key Differentiators Gogo Commercial Aviation Business Aviation GOGOAIR.COM |
Slide 13: Capitalizing on Large Growth Opportunity in Aircraft and Data Demand
CAPITALIZING ON LARGE GROWTH OPPORTUNITY IN AIRCRAFT AND DATA DEMAND Commercial Aircraft 5x Global broadband aircraft online as of 9/30/2015 based on management estimates, public filings and trade publications. Derived from Boeing Current Market Outlook 2015 – 2034, excludes: cargo aircraft; 3) JetN
Slide 14: Focused Growth Strategy
FOCUSED GROWTH STRATEGY ~11,000 uncommitted commercial aircraft globally & growing ~ 16,000 uncommitted business aircraft in North America & growing Develop aircraft communications platforms to enable: Tailored passenger experience Digitized front line employees Improved operations Aggressive roll o
Slide 15: Agenda
AGENDA GOGOAIR.COM | On the Move Strategy Going Forward Key Differentiators Gogo Commercial Aviation Business Aviation
Slide 16: Leading Global Position and Scale in Commercial Aviation
GOGO - LEADING GLOBAL POSITION AND SCALE IN COMMERCIAL AVIATION Most Connectivity Revenue ($MM) CA-ROW CA-NA Most Broadband Connected Commercial Aircraft 2,472 3X Closest Competitor CA-NA & CA-ROW Service Revenue 44% CAGR 2Ku will unlock the connected plane and drive revenue growth GOGOAIR.COM | (1)
Slide 17: On a Mission to Connect Global Aviation
ON A MISSION TO CONNECT GLOBAL AVIATION GOGOAIR.COM | Gogo is recognized as a leader globally Gogo presence Latin America 1,400 Europe, CIS 5,200 Middle East, Africa 1,700 Asia Pacific 5,300 61%* YOY increase in consideration 63%* of airlines consider Gogo for IFC/IFE needs *Source: Gogo Global Airl
Slide 18: 2Ku: Superior Design, Superior Performance
2Ku: SUPERIOR DESIGN, SUPERIOR PERFORMANCE Traditional Gimbaled Aperture 2Ku Photo to scale 2Ku is exclusive to Gogo Performance results: Speed tests exceeded 12 Mbps to a device Streamed videos simultaneously to 40 devices IPTV demonstrates great performance, uses same antenna Market deployment and
Slide 19: 2Ku Choice Is Clearly Superior
2Ku CHOICE IS CLEARLY SUPERIOR GOGOAIR.COM | 9 2Ku – round is better, bigger is better Ku satellites ~180 in orbit today Ka satellites 2 to 5 Round antenna Rectangular antenna ViaSat Inmarsat Global Eagle Panasonic Based on management estimates and include satellites operated by Inmarsat, Viasat, Eu
Slide 20: CA-North America: Scale Drives Profitability
CA-NORTH AMERICA: SCALE DRIVES PROFITABILITY GOGOAIR.COM | CA-NA Service Revenue ($MM) & Aircraft Online CA-NA Segment Profit ($MM) Strong revenue growth fueled by increase in aircraft online and ARPA growth Strong operating leverage Expanding segment profit margins ~350 aircraft awarded, but not ye
Slide 21: CA-Rest of World: Focus on International Expansion
160 aircraft online as of 9/30/2015 ~ 400 aircraft awarded, but not yet installed as of 9/30/15 Near global Ku-band satellite network 2Ku technology selected by 8 airlines International Aircraft Awards and Aircraft Online Executing On Our International Expansion CA-ROW Segment Loss ($MM) Internation
Slide 22: Integrated Products and Services to Suit Airlines' Needs
Letting the airlines be themselves. Business models to suit airlines’ needs. INTEGRATED PRODUCTS AND SERVICES TO SUIT AIRLINES’ NEEDS GOGOAIR.COM | Connectivity, Text & Talk GGV, IPTV Crew connect, Electronic Flight Bag
Slide 23: Key Priorities for Commercial Aviation
KEY PRIORITIES FOR COMMERCIAL AVIATION GOGOAIR.COM | Win more aircraft Install backlog Develop operations-oriented communications platforms Launch 2Ku commercially Continue ATG-4 upgrades Develop Next Gen solutions 1. Increase Aircraft Online 3. Enable Connected Aircraft 2. Bring More Bandwidth to A
Slide 24: Agenda
AGENDA GOGOAIR.COM | On the Move Strategy Going Forward Key Differentiators Gogo Commercial Aviation Business Aviation
Slide 25: Established and Profitable Leader in Business Aviation
ESTABLISHED & PROFITABLE LEADER IN BUSINESS AVIATION GOGOAIR.COM | Total Revenue ($MM) Segment Profit ($MM) Market leader: Total of 8,700+ units online 89% market share in broadband connected aircraft 63% market share in Iridium connected aircraft Long-lasting relationships with all leading OEM and
Slide 26: Innovator with Leading R&D Capabilities
The only provider of all three primary networks to business aviation: ATG broadband, Iridium and Swiftbroadband INNOVATOR WITH LEADING R&D CAPABILITIES GOGOAIR.COM | In-flight Connectivity Connected Communications Platforms In-flight Entertainment Gogo Biz: ATG 1000, 2000, 4000, 5000 & 8000 4G expec
Slide 27: Gogo Biz for Any Aircraft
GOGO BIZ FOR ANY AIRCRAFT GOGOAIR.COM | ATG8000/ ATG5000 LARGE JETS 2,900 aircraft* ATG 8000 for higher capacity aircraft ATG5000/ ATG4000 MEDIUM JETS 4,300 aircraft* 87%(1) of installs are on medium or large aircraft ATG2000 LIGHT JETS 5,500 aircraft* 62%(1) of units are being installed on light je
Slide 28: BA: High-Margin Service Revenue Drives Profitability and Cash Flow
BA: HIGH-MARGIN SERVICE REVENUE DRIVES PROFITABILITY AND CASH FLOW GOGOAIR.COM | Service Revenue ($MM) ATG Aircraft Online Segment Profit ($MM) Average Monthly Service Revenue per Unit ($) 52% CAGR
Slide 29: Key Priorities for Business Aviation
KEY PRIORITIES FOR BUSINESS AVIATION GOGOAIR.COM | Increase North American market penetration Expand global service offerings Universal cabin system Pilot applications Gogo Cloud – content delivery network Deliver 4G in 2017 Develop Next Gen solutions 1. Increase Aircraft Online 3. Enable Connected
Slide 30: In Summary: Positioned for Strong Growth
IN SUMMARY POSITIONED FOR STRONG GROWTH GOGOAIR.COM | 2Ku – is the catalyst for global aviation Combined CA-NA and BA free cash flow positive YTD 2015 Aircraft Online ARPA Profitability Growth Game Changer Cash Flow Positive
Slide 31: Why Invest in Gogo
7X more connected aircraft than closest competitor $30B market High revenue growth High operating leverage Global scale Specialize in Connected Aircraft Leading technology WHY INVEST IN GOGO Leading Position, Experience & Scale Large Growth Opportunity Attractive Model High Barriers to Entry GOGOAIR
Slide 32: Appendix
APPENDIX GOGOAIR.COM |
Slide 33: Adjusted EBITDA Reconciliation
ADJUSTED EBITDA RECONCILIATION ($MM) 2009 2010 2011 2012 2013 2014 Q1 2014 Q2 2014 Q3 2014 Q4 2015 Q1 2015 Q2 2015 Q3 Net Income (142) (140) (18) (96) (146) (17) (19) (25) (24) (20) (25) (29) Interest Income (0) (0) (0) (0) (0) (0) (0) (0) (0) (0) (0) (0) Interest Expense 30 – 1 9 29 7 7 9 9 10 16 1