[Satellite News 05-09-11] Inmarsat reported a 15 percent increase in its 2011 first-quarter revenue at $323.9 million compared with the same period last year, boosted by growth in its maritime services division and payments received from its cooperative agreement with U.S. LTE broadband network operator LightSquared, the company announced in its latest financial results issued May 9.
    In a conference call with investors, Inmarsat CEO Andy Sukawaty said that the company’s analysis of data usage trends among FleetBroadband customers should drive optimism about Inmarsat’s potential in the service market. “The trend of average daily data usage is increasing. If usage continues to track this trend, usage growth will offset the pricing impact of migration in time. In addition, we believe the recent acquisition of Ship Equip and the introduction of FleetBroadband Plus, by Stratos, will allow us to retain customers who might have otherwise moved to competing VSAT services,” said Sukawaty.
    Liberum Capital Analyst Mark James said that while the operators’ first quarter results were in line with market expectations, certain growth results within Inmarsat’s service divisions were impressive. “Inmarsat’s 3 percent increase in maritime revenue to $24 million is likely to be well-received by the market, given that weak growth and outlook in the sector prompted a major sell-off of the firm’s shares at the time of its final results, sending them 10 percent lower in early March,” James said in a statement.
    Inmarsat’s 2011 first quarter MSS revenues declined slightly to $180.6 million, but was offset by income generated by the operator’s agreement with LightSquared, which is paying Inmarsat to use some of its spectrum.
    The MSS operator’s global revenues gained 21 percent from its first period results in 2010 at $222.8 million, driven by a 23 percent increase in EBITDA to $204.1 million. Inmarsat’s aeronautical revenues grew 4.4 percent to $23.8 million and leasing sector revenues increased 1.5 percent to $27.4 million. Inmarsat’s land mobile sector was one of the few soft spots for the company, which reported a 10.6 percent revenue decline to $40.4 million.
    Inmarsat installed 2,880 new satellite terminals during the first quarter, however, Sukawaty said lower data prices on its new generation of broadband terminals led to the revenue decline.
    “In voice services, we have lowered certain prices to respond to competition and retain business. The reduction in land mobile revenue reflects lower usage levels in the Middle East, mainly Afghanistan, which started to contract in the middle of 2010 and which have remained at lower levels generally since this time. Our land mobile sector revenue saw a contribution in the quarter from global events in North Africa and Japan. These events resulted in increased usage primarily of our BGAN service by government users, media organizations and aid agencies,” Sukawaty said.
    New product sales continued to be very strong for Inmarsat, but Sukawaty refrained from increasing his company’s full-year projections due to certain factors that continue to constrain MSS growth. “We continue to expect growth in our core MSS revenue for 2011 to be within our 2 percent to 4 percent range.”