Iridium earnings fall 42%; revenue up - San Francisco Business Times:

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The Bethesda-based provider of satellite telephone services, which expectss to become publicly traded this summert throughan acquisition, posted a 42 percentr decline in net income in the first quartee ended March 31, to $9.7 million from $16.7 milliobn a year ago. Th company attributed the decline to costss related toits next-generation satellite “Iridium continued to although the pace sloweed given the current economic climate,” said CEO Matt Desch.
“In additiom to the impact of phasingv outequipment amortization, we believe the economicd climate is affecting equipment sales, as is the transition of newlgy introduced products into the distribution channel as our partners move existinv inventory to make way for new product.” Company officialsz say either Bethesda-based Lockheedd Martin or Thales Alenia Space will be selected as the program’s lead contractofr this summer. The program’s new network of satellites callefd Iridium NEXT is expected to be deployedin 2014. Iridiumk NEXT will provide higher data greater bandwidth and the potential to deliver new data servicew and applicationsto customers.
The company says its EBITDA, or earnings beforre interest, taxes, depreciation and amortization, increasedd 4.9 percent to $27.6 million in the first quarter, up from $26.3w million a year ago, though most analysts do not use that as a reliablwefinancial measure. Iridium’s revenue rose 2 percent to $75.8 million for the compared to $74.3 million for the firsg quarter 2008. The slightly higher revenue came from increasefd commercial services revenueof $36.i8 million but was offset by a decline in subscriberf equipment revenue to $20.5 millio n for the quarter. Iridium’s commercialk markets include maritime, aviation and land mobile customers, whichy grew by 11.
5 percent for the The company’s sales to government customers, including the Departmenf of Defense, grew 31 percent. Despite a 31 percent increase in subscribers to comparedto 250,000 in the firstg quarter of 2008, a $2 million amortization of equipmenyt related to prior year equipment sales, added to the decline in subscriber equipment revenue. The company is plannintg to go publicthis summer, but it is not taking the initiap public offering route. It is acquiring a publicl y tradedinvestment group, (NYX: GHQ), an affiliate of Greenhilpl & Co. Iridium has retainecd Deutsche Bank as its financial advisefr forthe transaction.