[Satellite TODAY Insider 04-18-11] A number of catalysts developing in the next several months should propel Iridium Communications’ long-term financial outlook, according to Raymond James Analyst Chris Quilty, who predicts that the MSS operator’s 2011 first quarter results, due in mid-May, will include a 27 percent EBITDA increase to offset declines in equipment sales.
    Quilty told Satellite TODAY Insider that Iridium’s high-margin service revenues will keep its first quarter 2011 results in line with analysts’ estimates. "Our first-quarter service revenue growth forecast of 16.5 percent may be a tad aggressive given management’s full-year guidance of 10 to 13 percent growth, but we see Iridium hitting or exceeding this target on a full-year basis, aided by favorable trends in M2M, OpenPort, and even voice subscribers," he said.
    Raymond James also sees Iridium making progress in the military sector, building off the company’s $13.4 million U.S. Department of Defense contract to conduct Phase 3 development efforts for Netted Iridium tactical radio services. "We believe further orders of this size, or greater, could commence by year-end, assuming successful completion of Phase 3 development efforts," Quilty said.
    To support its hosted payload business, Iridium is in discussions to place next-generation air traffic transceivers (ADS-B) on every Iridium satellite. If successful, Quilty believes the effort would provide significant upfront cash and hosting fees for the operators, as well as downstream revenues from selling data to the U.S. Federal Aviation Administration (FAA).
    "We estimate that the FAA opportunity, alone, could generate tens of millions of dollars annually," Quilty said.

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