[Satellite News 08-10-10] Iridium Communications saw its billable subscriber base grow 16.8 percent to about 383,000 in its 2010 second quarter, with growth coming from several of its product areas, the mobile operator announced in its latest financial results, issued Aug. 10.
    Iridium CFO Tom Fitzpatrick said based on Iridium’s second quarter subscriber growth, the company is increasing its 2010 full-year guidance. “We now expect billable subscriber growth for the year to exceed 20 percent, an increase from our previous guidance of 10 percent to15 percent.”
    Iridium’s commercial service revenue increased 13.8 percent to $45.5 million in the second quarter compared to $40 million during the second quarter of 2009. The operator’s government voice and machine-to-machine (M2M) data service revenue also increased 7.1 percent to $14.2 million. Subscriber equipment revenue for the second quarter decreased to $20.3 million from the $24.6 million reported in the second quarter of 2009 due to a global parts supply issue that delayed some shipments to customers and a change in the mix of equipment sales to lower-cost M2M devices,
    Iridium’s total revenue increased from $82.7 million in the second quarter of 2009 to $84.0 million in 2010 — representing a 4.6 percent increase over its standing halfway through the previous year.
    Non-cash expenses of $11.8 million, which were related to purchase accounting adjustments in GHL Acquisition Corp.’s acquisition of Iridium Holdings, caused the company’s second quarter net income to fall to $3.2 million compared to net income of $28.6 million in the second quarter of 2009.
   Raymond James analyst Chris Quilty was impressed by the company’s growth in subscribers and M2M business. “Despite temporary product shortages, Iridium net [subscriber] adds totaled 24,800 against our forecast of 21,800 — representing the company’s best performance in two years. … Iridium’s M2M pipeline is strengthened.   Since launching the new 9602 M2M device in May 2010, Iridium has received orders for over 100,000 units to ship over the next 18 months. By contrast, Iridium turned on 26,000 M2M devices in 2008, the company’s best year to date, and our model assumed only 93,000 net adds over the next six quarters.”
    Iridium CEO Matt Desch called the 2010 second quarter “the most transformative ever in the life of Iridium,” and said the company is close to completing its $1.8 billion Coface financing of its Iridiun Next constellation project. “We are pleased that we cleared a critical hurdle by receiving preliminary commitments from banks in excess of that amount. We selected Thales Alenia Space as our prime contractor, and they are already underway with developing our satellites. We announced a very favorably priced launch services contract with SpaceX and witnessed their inaugural Falcon 9 launch. And we lowered our operational costs through new contracts with Boeing.”