DigitalGlobe Extends Useful Lives of Two Satellites
[Via Satellite 12-18-2014] As a result of its annual satellite life review, DigitalGlobe will extend the useful lives of two of its satellites: WorldView 1 and WorldView 2. The company has also assigned an initial useful life to its newest satellite, WorldView 3 that is slightly longer than the original use lives assigned to its two predecessors.
The extended use lives will drive improved capital efficiency, lower capital expenditures, and better cash flows for DigitalGlobe. WorldView 1 will be extended by 2.5 years to 13 years — a 24 percent lifespan improvement — and WorldView 2 will be extended two years to 13 years — an 18 percent lifespan improvement.
“Extending the useful lives of our satellites will further reduce the capital required to sustain this unmatched capability over the long term. We expect this to result in a less capital intensive business model, improved free cash flow and returns, and improving shareholder value,” said Jeffrey R. Tarr, CEO of DigitalGlobe. In addition, the use-life extensions will result in non-cash reductions to revenue and depreciation expense effective Oct. 1.