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|Globecomm Systems Reports Fiscal 2010 Fourth Quarter and Fiscal Year 2010 Financial Results|
HAUPPAUGE, N.Y., Sep 13, 2010 (BUSINESS WIRE) --
Globecomm Systems Inc. (NASDAQ:GCOM), a leading global provider of satellite-based managed network solutions, today announced financial results for the fiscal 2010 fourth quarter and fiscal year ended June 30, 2010. Globecomm reports its financial results on a generally accepted accounting principles (GAAP) basis as well as adjusted EBITDA and adjusted diluted net income per common share, both non-GAAP measures, for which the Company provides detailed reconciliations in the attached tables. A summary of the Company's results are:
Fiscal Year 2010 Fourth Quarter Results
Revenues for the Company's fiscal 2010 fourth quarter increased 42.7% to $70.3 million as compared to $49.2 million in the same period last year. Revenues from services increased 60.4% to a record $39.6 million as compared to $24.7 million in the same period last year. The increase in service revenues was primarily driven by organic growth in the government marketplace, coupled with the Company's acquisitions of Telaurus and C2C/Evocomm, which combined contributed additional revenue of $7.8 million. Revenues from infrastructure solutions increased by 24.9% to $30.7 million as compared to $24.5 million in the same period last year. The increase in infrastructure solution revenues was driven by an increase in revenues in the systems design and integration offering.
Net income for the Company's fiscal 2010 fourth quarter increased to $4.0 million, or $0.19 diluted net income per common share, as compared to net income of $1.0 million, or $0.05 diluted net income per common share in the same period last year. The increase in net income was driven by the significant increase in services revenue. Excluding a $0.07 gain relating to non-recurring tax adjustments, fiscal year 2010 fourth quarter adjusted diluted net income per common share increased 140% to $0.12, as compared to $0.05 of adjusted diluted net income per common share in the same period last year. Adjusted EBITDA for the fourth quarter of 2010 increased to $7.0 million, a Company record, as compared to adjusted EBITDA of $3.2 million in the fourth quarter of 2009.
Fiscal Year 2010 Full Year Results
Revenues for the Company's fiscal year ended June 30, 2010 increased 33.9% to $227.8 million, a Company record, as compared to $170.2 million last year. Service revenues increased by 66.9% to a record $135.8 million as compared to $81.3 million last year. The increase in service revenues was primarily driven by the Company's acquisitions of Mach 6, Telaurus and C2C/Evocomm, which contributed additional revenue of $33.5 million coupled with organic growth in the government marketplace. Revenues from infrastructure solutions increased 3.6% to $92.0 million as compared to $88.8 million last year. The increase in infrastructure solution revenues was driven by an increase in the systems design and integration offering partially offset by a decrease in pre-engineered products revenues.
Net income for the Company's fiscal year ended June 30, 2010 increased to $7.9 million or $0.38 diluted net income per common share, compared to net income of $3.3 million or $0.16 diluted net income per common share last year. Excluding a net $0.04 gain relating to a non-recurring tax benefit of $0.07 partially offset by costs related to a previously announced acquisition charge of $0.03, fiscal year 2010 net income per diluted share would have been $0.34, as compared to $0.16 last year. Adjusted EBITDA for the Company's fiscal year ended June 30, 2010 increased to $20.9 million, a Company record, as compared to $12.2 million last year.
Fiscal Year 2010 Highlights
Management's Review of Results and Expectations
David Hershberg, Chairman and CEO, said "The largest acquisition in the Company's history capped off a record year for the Company. We enter fiscal 2011 with greater visibility than ever and look forward to a record year as the service segment takes center stage. The balance sheet remains strong and we will continue to make strategic acquisitions if they fit our stringent criteria. The Company will also make strategic investments internally to expand our products portfolio and capabilities for all market verticals. Our overall staff has increased by roughly 20% to over 400 employees and we are pleased with the seamless integration of our new subsidiaries. At this point, we have sufficient resources to carry out our business plan and I would like to thank the employees for another terrific year."
Keith Hall, President and COO, added "It was another tremendous year of execution, in tough economic conditions, as we continued to expand our reach as a global managed network solutions provider. The year was highlighted by strong renewals and expansion of our U.S. government contracts. We also saw increased activity in the commercial side of the business which we expect to rebound with the economy. The Company made significant investments across all five verticals, including a state-of-the-art core Ericsson switch, the TomCat(TM) X-Band Man Pack and the Tempo software as a service enterprise media platform. We will continue to make strategic investments with further development of the Man Pack as well as strategic investments into the maritime, media and wireless verticals. In the coming year we will continue our efforts to integrate our new subsidiaries to create greater efficiencies. We are excited about the opportunities in front of us."
Management's Current Expectations for the Fiscal Year Ending June 30, 2011
Globecomm currently expects the following financial results for the fiscal year 2011:
Adjusted EBITDA is a non-GAAP measure which represents net income before interest income, interest expense, provision (benefit) for income taxes, depreciation, amortization expense, non-cash stock compensation expense, and acquisition costs. Adjusted EBITDA does not represent cash flows as defined by GAAP. Globecomm discloses adjusted EBITDA since it is a financial measure commonly used in its industry. Because adjusted EBITDA facilitates internal comparisons of our historical financial position and operating performance on a more consistent basis, the Company also uses adjusted EBITDA in measuring performance relative to that of our competitors and in evaluating acquisition opportunities. Adjusted EBITDA is not meant to be considered a substitute or replacement for net income as prepared in accordance with GAAP. Adjusted EBITDA may not be comparable to other similarly titled measures of other companies. Reconciliation between GAAP net income and adjusted EBITDA is provided in a table immediately following the Condensed Consolidated Balance Sheets.
Reconciliation of adjusted diluted net income per common share excludes acquisition related costs. These amounts are not in accordance with GAAP and Globecomm believes this provides greater transparency by helping illustrate comparability between current and prior periods. Under the new accounting pronouncement on business combinations, effective in fiscal 2010 for the Company, acquisition-related transaction expenses are required to be expensed rather than capitalized and therefore the exclusion of the acquisition costs is a non-GAAP measure that provides better comparability of results.
Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with the Company's consolidated financial statements prepared in accordance with GAAP. The Company's management regularly uses supplemental non-GAAP financial measures internally to understand, manage and evaluate the Company's business and make operating decisions.
About Globecomm Systems
Globecomm Systems Inc. provides end-to-end value-added satellite-based communication products, services and solutions by leveraging its core satellite ground segment systems and network capabilities, with its satellite communication services capabilities. The products and services Globecomm offers include pre-engineered systems, systems design and integration services, access services, hosted services and lifecycle support services. Globecomm's customers include government, enterprises, media, maritime and wireless service providers.
Based in Hauppauge, New York, Globecomm Systems also maintains offices in Maryland, New Jersey, Virginia the Netherlands, South Africa, Hong Kong, Germany, Singapore, the United Arab Emirates and Afghanistan.
This press release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements are based on management's current expectations and observations.You should not place undue reliance on our forward-looking statements because the matters they describe are subject to certain risks, uncertainties and assumptions that are difficult to predict. Our forward-looking statements are based on the information currently available to us and speak only as of the date of this press release. Over time, our actual results, performance or achievements may differ from those expressed or implied by our forward-looking statements, and such difference might be significant and materially adverse to our security holders. In particular, the impact of the current economic downturn and the unpredictability of government spending programs make assessment of future performance extremely difficult.We undertake no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.
We have identified some of the important factors that could cause future events to differ from our current expectations and they are described in our most recent Annual Report on Form 10-K, including without limitation under the captions ''Risk Factors'' and ''Management's Discussion and Analysis of Financial Condition and Results of Operations,'' and in other documents that we may file with the SEC, including our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, all of which you should review carefully. Please consider our forward-looking statements in light of those risks as you read this press release.
SOURCE: Globecomm Systems Inc.
Globecomm Systems Inc.
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