DigitalGlobe, Inc. (NYSE: DGI), a leading global provider of
commercial high-resolution earth imagery products and services,
today reported financial results for the second quarter ended June
30, 2010.
Second quarter 2010 revenue was $81.0 million, an increase
of 16% compared with the same period last year. Second quarter 2010
net income was $0.5 million, or $0.01 per diluted share,
compared with net income of $8.4 million, or $0.19 per diluted
share, for the same period last year. Net income for the second
quarter included the impact of accelerating the depreciation of
certain software assets, which impacted pre-tax results by
$1.9 million, or $0.04 per diluted share.
Second quarter 2010 Adjusted EBITDA, a non-GAAP financial
measure, was $44.2 million, compared with second quarter 2009
Adjusted EBITDA of $42.4 million.
“We are very pleased with our record second quarter results. Our
double-digit top-line growth was propelled by strong commercial
results and continued execution in our direct access program. The
addition of WorldView-2 to our constellation at the beginning of
the year has been instrumental to our growth, providing materially
faster, more reliable collection, refresh and monitoring for our
customers. We are also pleased with the progress we are making in
expanding our finished product and service offerings,” said Jill
Smith, Chairman and Chief Executive Officer. “We continue to have
great confidence that we will reach the 2010 milestones for our
business across all of our key performance metrics.”
Second Quarter Business Highlights
- Defense and Intelligence segment
revenue was $63.2 million, up 8% compared with the second quarter
2009, driven primarily by the company’s Direct Access Program
(DAP), which generated $9.6 million in the quarter. The company
brought its third and fourth DAP customers into operation in the
quarter.
- Commercial segment revenue was
$17.8 million, up 52% compared with the second quarter 2009, driven
primarily by strength in consumer and international civil
government, which make up nearly two-thirds of segment
revenue.
- In the quarter, the company
delivered substantially all of its tasking orders within 45 days,
reinforcing the industry-leading collection, refresh and monitoring
capabilities of its constellation.
- The company’s ImageLibrary now
holds more than 89 percent of the earth’s landmass, with 79 percent
of its imagery less than two years old.
- The company continues to expand
its finished product and service offerings, including the launch of
its Advanced Ortho Series and expanded global web services and
cloud computing offerings.
- In the quarter, the company
extended two core value added services contracts with the National
Geospatial-Intelligence Agency (NGA), Rapid Delivery of Online
Geo-Spatial Intelligence (RDOG) and Crisis Event Service.
Full-Year 2010 Outlook
The company reaffirmed its full-year 2010 outlook:
- Full year 2010 total revenue is
expected to be between $330 million and
$360 million.
- Full year 2010 diluted earnings
per share are expected to be between $0.25 and $0.55.
- Full year 2010 Adjusted EBITDA
is expected to be between $185 million and $210 million,
with margins between 56% and 58%.
- Capital expenditures for 2010
are expected to be between $30 million and
$35 million.
Conference Call Information
DigitalGlobe’s management will host a conference call today at 5
p.m. EDT to discuss second quarter 2010 results.
The conference call dial-in numbers are as follows:U.S./Canada
dial-in: 866-921-3936International dial-in: 706-679-9623Passcode:
8706-2541
A replay of the call will be available through September 4, 2010
at the following numbers:US/Canada dial-in:
800-642-1687International dial-in: 706-645-9291Passcode:
8706-2541
DigitalGlobe will also sponsor a live and archived webcast of
the conference call on its website, www.digitalglobe.com.
Supplemental earnings materials are also available at this
website.
About DigitalGlobe
Longmont, Colorado-based DigitalGlobe
(http://www.digitalglobe.com) is a leading global provider of
commercial high-resolution earth imagery products and services.
Sourced from our own advanced satellite constellation, our imagery
solutions support a wide variety of uses within defense,
intelligence, and homeland security applications, mapping and
analysis, environmental monitoring, oil and gas exploration,
infrastructure management, internet portals and navigation
technology.
With our collection sources and comprehensive ImageLibrary
(containing more than 1 billion square kilometers of earth
imagery and imagery products) we offer a range of on- and off-line
products and services designed to enable customers to easily access
and integrate our imagery into their business operations and
applications.
DigitalGlobe is a registered trademark of DigitalGlobe.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This presentation and other of our reports, filings, and public
announcements may contain or incorporate forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995, as amended. Forward-looking statements relate to future
events or our future financial performance. We generally identify
forward-looking statements by terminology such as “may,” “will,”
“should,” “expects,” “plans,” “anticipates,” “could,” “intends,”
“target,” “projects,” “contemplates,” “believes,” “estimates,”
“predicts,” “potential” or “continue” or the negative of these
terms or other similar words, although not all forward-looking
statements contain these words.
Any forward-looking statements are based upon our historical
performance and on our current plans, estimates and expectations.
The inclusion of this forward-looking information should not be
regarded as a representation by us that the future plans, estimates
or expectations will be achieved. Such forward-looking statements
are subject to various risks and uncertainties and assumptions. A
number of important factors could cause our actual results or
performance to differ materially from those indicated by such
forward looking statements, including: the loss, reduction or
change in terms of any of our primary contracts; the loss or
impairment of our satellites; loss or damage to the content
contained in our ImageLibrary; interruption or failure of our
ground system and other infrastructure, decrease in demand for our
imagery products and services; increased competition that may
reduce our market share or cause us to lower our prices; our
failure to obtain or maintain required regulatory approvals and
licenses; changes in U.S. foreign law or regulation that may limit
our ability to distribute our imagery products and services; the
costs associated with being a public company; and other important
factors, all as described more fully in our filings with the
Securities and Exchange Commission, including our Annual Report on
Form 10-K.
We undertake no obligation to update any forward-looking
statement to reflect events or circumstances after the date on
which the statement is made or to reflect the occurrence of
unanticipated events. Readers are cautioned not to place undue
reliance on any of these forward looking statements.
Non-GAAP Financial Measures
Adjusted EBITDA is a key measure used in internal operating
reports by management and the board of directors to evaluate the
performance of our operations and is also used by analysts,
investment banks and lenders for the same purpose. Adjusted EBITDA
is a measure of our current period operating performance, excluding
charges for capital, depreciation related to prior period capital
expenditures and items which are considered non-core in nature.
We believe that the elimination of certain non-cash and
non-operating items enables a more consistent measurement of period
to period performance of our operations, as well as a comparison of
our operating performance to companies in our industry. We believe
this measure is particularly important in a capital intensive
industry such as ours, in which our current period depreciation is
not a good indication of our current or future period capital
expenditures. The cost to construct and launch a satellite and
build the related ground infrastructure may vary greatly from one
satellite to another, depending on the satellite’s size, type and
capabilities. For example, our QuickBird satellite, which we are
currently depreciating, cost significantly less than our
WorldView-1 or WorldView-2 satellites. Current depreciation expense
is not indicative of the revenue generating potential of the
satellites.
Adjusted EBITDA excludes interest income (expense), net, income
taxes and loss from early extinguishment of debt because these
items are associated with our capitalization and tax structures.
Adjusted EBITDA excludes depreciation and amortization expense
because these non-cash expenses reflect the impact of prior capital
expenditure decisions which are not indicative of future capital
expenditure requirements. Adjusted EBITDA excludes non-cash stock
compensation expense because these are non-cash expenses and loss
on derivative instrument because these items are not related to our
primary operations.
We use Adjusted EBITDA in conjunction with traditional GAAP
operating performance measures as part of our overall assessment of
our performance and we do not place undue reliance on this measure
as our only measure of operating performance. Adjusted EBITDA is
not a recognized term under generally accepted accounting
principles, or GAAP, in the United States and may not be defined
similarly by other companies. Adjusted EBITDA should not be
considered an alternative to net income, as an indication of
financial performance, or as an alternative to cash flow from
operations as a measure of liquidity. There are limitations to
using non-GAAP financial measures, including the difficulty
associated with comparing companies that use similar performance
measures whose calculations may differ from ours.
DigitalGlobe, Inc.
Condensed Consolidated
Statements of Operations
(unaudited)
(in
millions, except share and per share data) For the Three Months
Ended June 30, For the Six Months Ended June 30, 2009
2010 2009
2010 Revenue $ 70.0 $ 81.0 $ 137.2 $ 158.1 Costs and
expenses: Cost of revenue, excluding depreciation and amortization,
presented below 8.0 10.1 14.4 20.2 Selling, general and
administrative 21.5 28.2 44.1 53.0 Depreciation and amortization
18.9 31.0 37.6
60.1 Income from operations 21.6 11.7 41.1 24.8 Loss from
early extinguishment of debt (7.7 ) - (7.7 ) - Loss on derivative
instruments - - (1.8 ) - Interest income (expense), net 0.1
(10.7 ) 0.1 (20.6 ) Income
before income taxes 14.0 1.0 31.7 4.2 Income tax expense
(5.6 ) (0.5 ) (12.7 ) (2.2 ) Net income $ 8.4
$ 0.5 $ 19.0 $ 2.0 Earnings per share:
Basic earnings per share $ 0.19 $ 0.01 $ 0.43
$ 0.05 Diluted earnings per share $ 0.19 $ 0.01
$ 0.43 $ 0.04 Weighted average common shares
outstanding: Basic 44,163,507 43,987,552
44,199,522 43,876,444 Diluted
44,695,213 46,111,912 44,714,326
46,143,028
DigitalGlobe, Inc.
Unaudited Reconciliation of
GAAP Net Income to Adjusted EBITDA
($
in millions)
Three months ended June 30,
Six months ended June 30, 2009
2010 2009 2010 Net income $ 8.4
$ 0.5 $ 19.0 $ 2.0 Depreciation and amortization 18.9 31.0 37.6
60.1 Interest (income) expense, net (0.1 ) 10.7 (0.1 ) 20.6 Loss
from early extinguishment of debt 7.7 - 7.7 - Loss on derivative
instrument - - 1.8 - Income tax expense 5.6 0.5 12.7 2.2 Non-cash
stock compensation expense 1.9 1.5 4.2
2.9 Adjusted EBITDA $ 42.4 $ 44.2 $ 82.9
$ 87.8
Adjusted EBITDA is not a recognized term under generally
accepted accounting principles, or GAAP, in the United States and
may not be defined similarly by other companies. Adjusted EBITDA
should not be considered an alternative to net income, as an
indication of financial performance, or as an alternative to cash
flow from operations as a measure of liquidity. There are
limitations to using non-GAAP financial measures, including the
difficulty associated with comparing companies that use similar
performance measures whose calculations may differ from ours.
DigitalGlobe, Inc.
Condensed Consolidated Balance
Sheets
(unaudited)
(in
millions, except share and per share data)
ASSETS December
31, 2009 June 30, 2010
CURRENT ASSETS: Cash and cash
equivalents $ 97.0 $ 142.8 Restricted cash 7.3 7.7 Accounts
receivable, net of allowance for doubtful accounts of $1.2 and
$1.4, respectively 49.7 55.0 Prepaid and current assets 12.0 12.4
Income tax receivable 3.9 3.9 Deferred taxes 1.7
1.9 Total current assets 171.6 223.7 Property and
equipment, net of accumulated depreciation of $361.1 and $420.6,
respectively 891.0 856.8 Goodwill 8.7 8.7 Intangibles, net of
accumulated amortization of $7.2 and $6.9, respectively 1.8 1.0
Aerial image library 5.4 3.1 Long-term restricted cash 16.7 15.4
Long-term deferred contract costs 36.2 47.0 Other assets, net
9.1 8.3 Total assets $ 1,140.5 $
1,164.0
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES: Accounts payable $ 4.3 $ 5.3 Accrued
interest 6.2 6.2 Other accrued liabilities 17.9 21.5 Current
portion of deferred revenue 32.8 37.0
Total current liabilities 61.2 70.0 Long-term accrued liability -
7.0 Deferred revenue 239.6 232.5 Deferred lease incentive 5.4 5.0
Long-term debt 343.5 344.8 Long-term deferred tax liability
11.3 12.8 Total liabilities $ 661.0 $ 672.1
COMMITMENTS AND CONTINGENCIES (Note 11) STOCKHOLDERS'
EQUITY: Preferred stock, $0.001 par value; 24,000,000 shares
authorized; no shares issued and outstanding at December 31, 2009
and June 30, 2010 $ - $ - Common stock; $0.001 par value;
250,000,000 shares authorized; 45,122,593 shares issued and
outstanding at December 31, 2009 and 45,776,482 shares issued and
outstanding at June 30, 2010 0.2 0.2 Treasury stock, at cost;
44,039 shares at December 31, 2009 and at June 30, 2010 (0.7 ) (0.7
) Additional paid-in capital 496.0 506.4 Accumulated deficit
(16.0 ) (14.0 ) Total stockholders' equity 479.5
491.9 Total liabilities and stockholders'
equity $ 1,140.5 $ 1,164.0
DigitalGlobe, Inc.
Condensed Consolidated
Statements of Cash Flows
(unaudited)
($ in millions) For the Six Months
Ended June 30, 2009
2010
CASH FLOWS FROM OPERATING
ACTIVITIES: Net income $ 19.0 $ 2.0 Adjustments to reconcile
net income to net cash provided by operating activities:
Depreciation and amortization expense 37.6 60.1 Non-cash
recognition of pre-FOC payments (13.3 ) (12.8 ) Non-cash
amortization 2.5 2.2 Non-cash stock compensation expense 4.2 2.9
Amortization of debt issuance costs - 2.3 Non-cash portion of loss
on extinguishment of debt 5.3 - Deferred income taxes 11.6 1.4
Changes in: Accounts receivable, net (5.5 ) (5.3 ) Accounts
receivable from related party (0.2 ) - Aerial image library (2.5 )
0.1 Other assets (2.2 ) (0.6 ) Accounts payable 1.1 - Accounts
payable and accrued liabilities to related parties 3.3 - Accrued
liabilities (2.6 ) 5.8 Deferred contract costs from related party
(7.7 ) - Deferred contract costs - (11.2 ) Deferred revenue 7.2 9.9
Deferred revenue related party 2.1 -
Net cash flows provided by operating activities 59.9
56.8
CASH FLOWS FROM INVESTING ACTIVITIES:
Construction in progress additions (61.2 ) (16.1 ) Other property,
equipment and intangible additions (4.6 ) (3.3 ) Settlements from
derivative instrument (2.8 ) - Change in restricted cash
(1.7 ) 0.9 Net cash flows used in investing
activities (70.3 ) (18.5 )
CASH FLOWS FROM
FINANCING ACTIVITIES: Proceeds from issuance of debt, net of
issuance costs 330.9 - Proceeds from initial public offering, net
of issuance costs 21.7 - Repayment of notes (270.0 ) - Costs
associated with initial public offering - (0.3 ) Payments for
repurchase of common stock (0.4 ) - Proceeds from exercise of stock
options 0.1 7.8 Net cash flows provided
by financing activities 82.3 7.5 Net
increase in cash and cash equivalents 71.9 45.8 Cash and cash
equivalents, beginning of period 60.8 97.0
Cash and cash equivalents, end of period $ 132.7 $
142.8
SUPPLEMENTAL CASH FLOW INFORMATION: Cash paid
for income taxes $ 2.3 $ 0.1 Cash paid for interest
payments, net of amounts capitalized - 11.6
NON-CASH INVESTING
AND FINANCING ACTIVITIES: Changes to non-cash property and
equipment accruals, including interest $ (0.7 ) $ (5.8 ) Non-cash
items capitalized in construction in progress (4.1 ) -
Digitalglobe, (delisted) (NYSE:DGI)
Historical Stock Chart
From May 2024 to Jun 2024
Digitalglobe, (delisted) (NYSE:DGI)
Historical Stock Chart
From Jun 2023 to Jun 2024