Standard mobile coverage rarely extends to aeroplanes, ships and remote regions. Inmarsat (ISAT) is tackling that problem with Global Xpress, its worldwide, high-speed broadband network. Steady progress there, together with strong demand for its other satellite services, pushed cash profits up 8 per cent to $701m (£460m).
Profits increased in Inmarsat's key maritime and aviation divisions due to strong sales of its FleetBroadband and SwiftBroadband services, respectively. Average revenue per aviation user climbed 23 per cent to over $1,000 a month, while the maritime division received a $55m top-line boost from recently acquired Globe Wireless. Moreover, strip out disposals, and sales in the enterprise division rose 6 per cent, reflecting strong demand for machine-to-machine communication and satellite phones. The weak spot was the government division, where sales and profits tumbled due to the tight US budget and troop withdrawals from Afghanistan.
But investors may care more about advances in Global Xpress. Inmarsat launched its second satellite to support the network at the start of February 2015, the third should join it before the summer, and the last is on track for completion in mid-2016. The group expects to garner $500m in annual revenues within five years of the programme going live.
Inmarsat also has plans to launch an in-flight broadband service with the help of French telecoms giant Alcatel.
Consensus forecast EPS is 41¢ (from 51¢ in 2014).
| INMARSAT (ISAT) | ||||
|---|---|---|---|---|
| ORD PRICE: | 883p | MARKET VALUE: | £4bn | |
| TOUCH: | 883-884p | 12-MONTH HIGH: | 902p | LOW: 653p |
| DIVIDEND YIELD: | 3.6% | PE RATIO: | 18 | |
| NET ASSET VALUE: | 264¢* | NET DEBT: | 161% | |
| Year to 31 Dec | Turnover ($bn) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 2010 | 1.17 | 334 | 57 | 36.69 |
| 2011 | 1.41 | 367 | 55 | 40.36 |
| 2012 | 1.34 | 294 | 48 | 44.39 |
| 2013 | 1.26 | 189 | 23 | 46.61 |
| 2014 | 1.29 | 342 | 76 | 48.94 |
| % change | +2 | +81 | +230 | +5 |
Ex-div: 14 May Payment: 29 May *Includes intangible assets of $800m, or 178¢ a share £1=$1.52 | ||||
