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Inmarsat earnings led higher by demand for aviation broadband in fourth quarter

Inmarsat expects 20019 revenue of US$1.3-1.4bn, excluding a contribution from US partner Ligardo

Imarsat
Inmarsat expects to generate sustained free cash flow growth over the medium to long term

Satellite operator Inmarsat posted a 14.6% rise in earnings in the fourth quarter, driven by demand for aviation broadband.

The British group, which provides communications to ships, aircraft, companies and governments, said earnings (EBITDA) increased to US$190.6mln in the final three months of 2018 as revenue gained 7.6% to US$378.7mln.from

READ: Inmarsat wins contract to provide GX Aviation inflight broadband solution to Indonesian national airline Garuda

The aviation business saw revenues jump 51.8% to US$72.4mln in the quarter and the government division grew by 13.1% to US$102.7mln.  That offset declines in the enterprise and maritime units of 2.2% to US$31.4mln and 6% to US$135.7mln, respectively.

Total EBITDA for the year was US$7701.mln, up 4.2% from 2017, and revenue edged up 5.3% to US$1.47bn.

In 2019, revenue is expected to be US$1.3-1.4bn excluding a contribution from US partner Ligardo.

The group is targeting “mid-single digit percentage” revenue growth on average per year from 2018 to 2022 with EBITDA and free cash flow generation “improving steadily". 

"We remain focused on building and defending substantial market share in our target markets, supported by our diversified product portfolio and leading-edge networks,” said chief executive Rupert Pearce.

"This will ensure we are able to fully capitalise on both the immediate and longer-term growth opportunities in these markets.

"Supported by a tightly controlled cost base and an infrastructure capital investment programme which we are confident will meaningfully and sustainably moderate from 2021, we expect to generate sustained free cash flow growth over the medium to long term."

Quick facts: Inmarsat Plc

Price: 558.2 GBX

LSE:ISAT
Market: LSE
Market Cap: £2.58 billion
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