Inmarsat in H1 pre-tax loss, reiterates guidance

Satellite operator Inmarsat on Thursday reported an interim pre-tax loss of $119m compared with a profit of $63.4m a year earlier due to higher costs and currency movements.

However, the company maintained its guidance, saying that it would target “mid-single digit percentage revenue growth on average over the next five years, with EBITDA and free cash flow generation expected to improve steadily”.

The dividend was cut to 8 cents a share, from 21.62 cents a share.

Inmarsat, which last month rejected an offer from EchoStar, said group revenue increased by $33.5m, to $717.2m including an increase of $17.6m in the second quarter, driven predominantly by growth in aviation.

Direct costs increased by $31.7m, including an increase of $14.8m in the second quarter, reflecting the short term addition of low margin equipment revenue to help capture further market share, particularly in Aviation.

Indirect costs increased by $8.5m in the half, mainly as a result of a $9m adverse impact of currency movements in the first quarter.

Second quarter adjusted earnings before interest, taxes, depreciation, and amortisation rose 0.8% year on year to $198.1m.