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Speedcast International Ltd 2018 Annual Report

 

April 18, 2019

Speedcast's Revenue grew 21% to USD 623.1 million, including USD 7.5m contribution from two acquisitions completed in 2018 and the full year impact of acquisitions completed in 2017.

In 2018, Speedcast achieved strong organic growth across three of its ! divisions (Maritime, Government, and Enterprise and Emerging Markets (EEM)), however Energy division revenue continued to decline due to ongoing delays in the offshore Energy market recovery. Despite a challenging year the Company had several significant achievements, including signing the two biggest customer contracts in company history, completing the strategic Globecomm acquisition (at an attractive valuation and doubling revenue in the high growth Government division), and establishing a back office shared service centre model including transitioning to a common ERP system.

Maritime revenue grew 10% to USD 219.7 million. This growth was driven primarily by VSAT activations in Commercial Shipping and bandwidth growth and customer wins in the Cruise business.

Energy revenue was down 14% to USD 158.3 million due to continued delays in the recovery of the offshore Energy sector. However, second half 2018 revenues were 8% higher than first half 2018 revenues.

EEM revenue grew 27% to USD 147.9 million. This strong growth was driven by the first phase of the NBN contract in Australia as well as growth in wholesale voice activity.

Government revenue was USD 97.3 million in 2018. On a pro forma basis1 this represents a 16% increase, driven primarily by growth in intelligence, surveillance and reconnaissance services and increased U.S. defence spending.

Statutory profit for the year after tax attributable to owners of the Company decreased by 69% to USD 1.9 million.

The statutory results include costs which are non-recurring in nature, such as acquisition-related costs, integration costs, accelerated amortisation of loan establishment costs and foreign exchange gains on forward contracts undertaken in relation to acquisition funding. The financial performance of the Group excluding these non-recurring factors has also been presented in this report and is identified as being the "underlying" result.