Inmarsat: ‘Double-digit’ aviation growth, but dividend cut

Inmarsat Aviation signInmarsat has reported “double-digit” growth for its aviation business in its final-year 2017 results, but has cut its total dividend to 20 cents a share in order to boost investment in the inflight connectivity division.

Full-year revenue results for aviation were up 36.7% year-on-year to $195m.

Across the company as a whole, adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) were down $43.4m (5.5%) at $751.4m. Profit after tax was down $61.1m (25.1%) to $182.3m, mainly due to lower EBITDA and higher depreciation

The report highlights say the double-digit revenue growth for aviation reflected inflight connectivity (IFC) installation revenues, with 194 aircraft now installed with Global Xpress (GX) terminals (compared with 20 in 2016) and another year of strong growth in its core business and general aviation (BGA) and safety and operational services (SOS).

Inmarsat's I5F4 satellite lifts off from Florida aboard a SpaceX Falcon-9. Image: SpaceX
Inmarsat’s I5F4 satellite lifts off from Florida aboard a SpaceX Falcon-9. Image: SpaceX

Rupert Pearce, Inmarsat Chief Executive Officer, said: “Inmarsat delivered further operational and strategic progress in 2017, comprising both gratifying near-term revenue growth as well as several important strategic proof-points around exciting medium-term growth opportunities, especially in IFC.

“Our investment in Global Xpress, our high-bandwidth global mobile satellite network, is starting to show material returns, generating over $140m of revenue in the year.

“Our strategic investment in GX will enable us to retain and develop our competitive positions in Maritime and Government and will ensure that we are well placed to access the substantial opportunity in IFC in Aviation.

“In Aviation, we further established our market position in IFC, through commercial momentum and strategic investment, and our core business delivered double-digit revenue growth throughout 2017.

“Finally, we expect that Aviation will be the largest individual growth driver for the group in the coming years, through the consistent double-digit growth trajectory of our core aviation business and through the exceptional medium-term growth potential of the fast-emerging and substantial IFC segment, in which we have a burgeoning market presence.”

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