Inmarsat (ISAT) reached a key milestone in 2015: the completion and commercial launch of Global Xpress, its high-speed, worldwide broadband network. The satellite giant also took strides towards offering global inflight broadband to airplane passengers. It partnered with Deutsche Telekom to build the roughly 300 ground sites required for the European network, and won a landmark contract to fit out at least 190 of Lufthansa's aircraft over the next decade. Although revenue was flat, lower operating costs underpinned a 4 per cent rise in adjusted cash profit to $726m (£514m).
The key maritime business was buoyed by robust demand for FleetBroadband and other connectivity solutions. It also partnered with Ericsson to develop 'connected ship' solutions that let vessels share cargo, logistics and operational data. But rocky commercial shipping and energy markets, combined with flagging demand for legacy products, meant revenue flatlined there. Meanwhile, troop withdrawals and tightening defence budgets meant sales slumped by a tenth in the government segment. The bright spot was the aviation division; strong interest in SwiftBroadband meant turnover soared a fifth there.
Inmarsat's directors expect to launch a fourth Global Xpress satellite in late 2016. They're now guiding towards capital spending of $500m-$600m in 2016, 2017 and 2018. But they stood by their prediction that the initiative would contribute at least $500m to annual turnover within five years.
Prior to these figures, JPMorgan Cazenove expected adjusted profit of $338m in 2016, giving EPS of 41¢, down from $374m and 49¢ in 2015.
| INMARSAT (ISAT) | ||||
|---|---|---|---|---|
| ORD PRICE: | 913.5p | MARKET VALUE: | £4.1bn | |
| TOUCH: | 913-913.5p | 12-MONTH HIGH: | 1,153p | LOW: 855p |
| DIVIDEND YIELD: | 4% | PE RATIO: | 20 | |
| NET ASSET VALUE: | 278¢* | NET DEBT: | 159% | |
| Year to 31 Dec | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (¢) |
|---|---|---|---|---|
| 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 |
| 2015 | 1.27 | 338 | 63 | 51.39 |
| % change | -1 | -1 | -17 | +5 |
Ex-div: 12 May Payment: 27 May *Includes intangible assets of $772m, or 172¢ a share £1=$1.41 | ||||
