ORBCOMM Inc., a global provider of Internet of Things (IoT) solutions, today announced financial results for the first quarter ended March 31, 2017.
“Our strong sales pipeline resulted in a fast start to 2017, with a record first quarter despite typically being the softest quarter of the year,” said Marc Eisenberg, ORBCOMM’s Chief Executive Officer. “Leveraging our continued technology innovation with new products and increased leadership in our markets, 2017 is shaping up to be a defining year for ORBCOMM.”
“Total Revenues for the first quarter reached a record $51.9 million, with a strong backlog entering the second quarter,” said Robert Costantini, ORBCOMM’s Chief Financial Officer. “We generated $12.4 million of Adjusted EBITDA for the quarter, primarily driven by expanding high incremental margin Service Revenues.”
For Q1 of 2017, record Total Revenues of $51.9 million were up 19.2% year-over-year, with Service Revenues and Product Sales reaching record levels in the quarter. Service Revenues of $29.5 million increased 9.7% and Product Sales of $22.4 million were 34.6% higher this quarter than the prior year period.
For Q1 of 2017, Adjusted EBITDA of $12.4 million increased $1.7 million, improving 15.9% over the prior year period. Adjusted EBITDA margin was 23.9% of Total Revenues.
Net subscriber communicator additions for ORBCOMM were over 42,000 in Q1 of 2017, increasing the total billable subscriber communicators to nearly 1,766,000 at March 31, 2017, which compares to 1,609,000 at the end of last year; a 9.8% increase year-over-year.
On March 31, 2017, ORBCOMM announced that it has priced $250,000,000 aggregate principal amount of 8.0% senior secured notes due 2024. The net proceeds from the sale of the notes were used to repay the $150 million outstanding loans under ORBCOMM’s prior secured credit facilities, with the remaining intended for general corporate purposes, including potential future acquisitions.
Customer and Product Highlights
On April 4, 2017, ORBCOMM announced that Kevadiya Inc. (Kevadiya) selected ORBCOMM to provide satellite communications services and hardware in support of the Vehicle Tracking Program for the Federal Bureau of Prisons (BOP), a division of the U.S. Department of Justice. Kevadiya will be providing a fleet mobility tracking solution as part of the BOP program.
On March 21, 2017, ORBCOMM announced that it has collaborated with maritime technology industry leaders Pole Star and Weatherdock to develop Hali, a Class B tri-mode vessel tracking solution that ensures complete vessel visibility. Hali combines terrestrial and satellite Automatic Identification System (AIS) data capability with two-way satellite M2M technology to deliver reliable vessel location data to small craft and fleet owners & operators, maritime authorities and enforcement agencies, providing the actionable intelligence required to maximize maritime safety, security and environmental compliance.
On March 20, 2017, ORBCOMM announced that Kevadiya selected ORBCOMM to provide satellite and cellular communications services and asset tracking and monitoring devices in support of the Veterans Transportation Service (VTS) provided by the U.S. Department of Veterans Affairs (VA). The VA recently extended the VTS program based on the success of the ORBCOMM-Kevadiya telematics solution launched in 2015.
On March 10, 2017, ORBCOMM announced the award of a multi-year contract with the Australian Maritime Safety Authority (AMSA) through Kordia Pty Ltd (Kordia). ORBCOMM and Kordia, a leading provider of mission-critical networks in New Zealand, will provide satellite Automatic Identification System (AIS) data used for ship tracking and other maritime navigational and safety efforts to AMSA.
On February 28, 2017, ORBCOMM announced that Maerospace has won a multi-year contract with the Government of Canada to supply satellite Automatic Identification System (AIS) data used for ship tracking and other maritime navigational and safety efforts in conjunction with Maerospace’s TimeCaster™ technology. Maerospace, an industry expert in advanced data analytics, and ORBCOMM, providing AIS data through its Canadian subsidiary SkyWave, have partnered to provide the Government of Canada the technology to monitor Canadian and global maritime traffic.