Maritime demand boosts satellite operator Inmarsat

Satellite operator Inmarsat pushed up profits today as its first results as a listed company benefited from strong demand among maritime users.

The group, which has 10 satellites providing voice and data services, revealed a 4% hike in first-half revenues to $253.6m (€207.2m/£140.8m) with underlying earnings ahead 11% at $171.8m (€140.4m/£95.4m).

Inmarsat said the maritime sector had been the main driver of its improvement with growth in data revenues more than offsetting ongoing decline in voice.

On land, revenues were lower despite increased usage following the tsunami in Asia, while the aeronautical sector continued to expand as a result of greater use of its Swift64 service, which targets government and business jets.

Inmarsat added its growth prospects remained strong following the commercial launch of the first of its broadband-enabled Inmarsat-4 satellites in May.

It is in operation above the Indian Ocean and has enabled the company to migrate regional customers of its broadband network onto the satellite, meaning it no longer has to make lease payments to another operator.

Controlled from Inmarsat’s London offices, the satellite was mainly built in the UK through manufacturer Astrium’s sites at Portsmouth and Stevenage.

It is the size of a double-decker bus and 60 times more powerful than its predecessors.

With two more satellites due to be launched from the end of this year, the I-4 programme is on track to meet its budget of $1.5bn (€1.2bn/£833.1m).

Inmarsat made its debut on the London market in June with a flotation valued at £1.1bn (€1.6bn) – one of the biggest public offerings of the year so far.

Shares edged 1.25p lower to 316.75p today, but are still higher than the opening price of 245p.

The company has 25 years experience in designing, launching and operating its network, which is also used by broadcasters BBC and CNN, as well as the Ministry of Defence, British Airways and the International Red Cross.

At the bottom-line, profits jumped to $65.5m (€53.5m/£36.4m), from $29.3m (€23.9m/£16.3m) a year earlier, as Inmarsat benefited from lower depreciation costs resulting from the useful economic lives of its I-3 satellites being extended from 10 years to 13 years.

The company posts its results in US dollars as most of its revenues and borrowings are in the currency.