EchoStar Inmarsat bid: ‘Completely unacceptable’
August 3, 2018
By Chris Forrester
Inmarsat CEO Rupert Pearce told analysts August 2nd that the recent EchoStar bid for Inmarsat was so unacceptable that any dialogue or engagement would have been seen as weakness. Pearce said that the EchoStar experience would not alter Inmarsat’s strategy, which would not change given that the company has a strong core business.
“They had plenty of opportunity to make a serious offer and they decided not to,” Pearce said, adding that EchoStar did not come close to the level that would trigger Inmarsat to engage. “We are not for sale, we were not for sale, we are not a company that is concerned about its prospects as a standalone company,” he said.
Pearce said Inmarsat would stay a standalone business.
Pearce reported that Qatar Airways and Air New Zealand had rolled out its satellite supplied IFE service, and now had some 1400 aircraft under contract. Airline-related revenues were up 39 per cent to $116 million. Lufthansa had recently ‘soft launched’ its service.
Inmarsat reported revenues of $371.8 million for the quarter-year (and $165m EBITDA) excluding its Ligado interests, which came in 3 per cent and 8 per cent ahead of Q2 consensus forecasts.
A report from investment bank Exane/BNPP said: “This performance was largely driven by stronger revenues in Government business (up 13%). However, given that management had guided for this division to be under pressure from contract maturing we believe this beat may reflect timing rather than underlying factors. Aviation revenue growth is in line while Maritime revenues are 1 percent below with management reporting a 17 percent fall in VSAT ARPU and announcing the rollout of a new pricing strategy.”
Giles Thorne, at Jefferies, said that Inmarsat’s aviation sector was tracking well with the Year-to-date numbers tracking far ahead of earlier guidance, and up 40 per cent on expectations.