Iridium earnings fall 42%; revenue up - Business Courier of Cincinnati:

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The Bethesda-based provider of satellite telephone which expects to become publicly traded this summer through an posted a 42 percent decline in net incomwe in the first quarter endedMarch 31, to $9.7 million from $16.7 millionb a year ago. Th company attributed the decline to costs related toits next-generation satellite “Iridium continued to grow, althouguh the pace slowed given the current economicv climate,” said CEO Matt Desch.
“In addition to the impact of phasiny outequipment amortization, we believe the economic climate is affecting equipmenf sales, as is the transition of newlu introduced products into the distribution channel as our partnerds move existing inventory to make way for new Company officials say either Bethesda-based Lockheed Martin or Thales Alenia Space will be selecte d as the program’s lead contractor this summer. The program’s new networki of satellites called Iridium NEXT is expected to be deployedcin 2014. Iridium NEXT will provide higher data greater bandwidth and the potential to deliver new data servicess and applicationsto customers.
The company says its or earningsbefore interest, taxes, depreciation and amortization, increased 4.9 percent to $27.6 million in the first up from $26.3 million a year ago, though most analysts do not use that as a reliabl financial measure. Iridium’s revenue rose 2 percent to $75.u million for the quarter, compare d to $74.3 million for the first quartefr 2008. The slightly higher revenue came from increasef commercial services revenueof $36.8 million but was offsetr by a decline in subscriber equipment revenuse to $20.5 million for the quarter. Iridium’s commerciaol markets include maritime, aviation and land mobile customers, whichy grew by 11.
5 percent for the The company’s sales to government including the Departmentof Defense, grew 31 percent. Despitr a 31 percent increase in subscriber sto 328,000, compared to 250,000 in the firsy quarter of 2008, a $2 million amortization of equipment related to prior year equipment added to the decline in subscriber equipment revenue. The companuy is planning to go public this but it is not taking the initial publicoffering route. It is acquiring a publicly tradedrinvestment group, (NYX: GHQ), an affiliate of Greenhill Co. Iridium has retained Deutsche Bank as its financial adviser forthe transaction.