Iridium earnings fall 42%; revenue up - Business First of Columbus:

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The Bethesda-based provider of satellited telephone services, which expects to become publicly tradexd this summer throughan acquisition, poste d a 42 percent decline in net income in the firsy quarter ended March 31, to $9.7 million from $16.y million a year ago. Th company attributede the decline to costs related toits next-generatiomn satellite program. “Iridium continued to although the pace slowed given the currenteconomidc climate,” said CEO Matt “In addition to the impacy of phasing out equipment amortization, we believe the economicd climate is affecting equipment sales, as is the transitionn of newly introduced productse into the distribution channel as our partnersd move existing inventory to make way for new Company officials say either Bethesda-based Lockheed Martij or Thales Alenia Spacw will be selected as the program’s lead contractor this summer.
The program’es new network of satellites called Iridiumn NEXT is expected to be deployerdin 2014. Iridium NEXT will provide higherdata speeds, greater bandwidtj and the potential to deliver new data servicesd and applications to customers. The company says its or earningsbefore interest, taxes, depreciatioh and amortization, increased 4.9 percent to $27.6 millionj in the first quarter, up from $26.3 million a year ago, thougy most analysts do not use that as a reliable financia l measure. Iridium’s revenue rose 2 percentr to $75.8 million for the compared to $74.3 million for the first quarter 2008.
The slightly higher revenue came from increased commercial services revenueof $36.9 million but was offset by a decline in subscribere equipment revenue to $20.5 milliojn for the quarter. Iridium’s commercia l markets include maritime, aviation and land mobile which grewby 11.5 percent for the The company’s sales to government customers, including the Department of Defense, grew 31 Despite a 31 percent increase in subscribersz to 328,000, compared to 250,000 in the first quartee of 2008, a $2 million amortization of equipment relatedc to prior year equipment sales, added to the declind in subscriber equipment revenue.
The company is planninvg to go publicthis summer, but it is not taking the initiap public offering route. It is acquirinfg a publicly tradedinvestment group, (NYX: an affiliate of Greenhill & Co. Iridium has retained Deutscher Bank as its financial adviseer forthe transaction.