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8-K - FORM 8-K - DIGITALGLOBE, INC. | c04603e8vk.htm |
Exhibit 99.1
Media Contact:
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Investor Contact: | |
Erika Dornaus
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David Banks | |
Racepoint Group
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DigitalGlobe | |
781.487.4637
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303.684.4210 | |
digitalglobe@racepointgroup.com
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dbanks@digitalglobe.com |
DigitalGlobe Secures $3.55 Billion EnhancedView Agreement with National
Geospatial Intelligence Agency (NGA)
Geospatial Intelligence Agency (NGA)
Updates Full-Year 2010 Outlook
Company to Hold Conference Call Today at 1:30PM EDT
Company to Hold Conference Call Today at 1:30PM EDT
Longmont, Colorado, August 9, 2010 DigitalGlobe (NYSE: DGI), a leading global content provider of
high-resolution earth imagery solutions, today announced that it has entered into a $3.55 billion
Service Level Agreement (SLA) with NGA, under the EnhancedView procurement, effective September 1,
2010 upon expiration of the companys NextView Agreement.
The agreement provides for DigitalGlobe to supply satellite imagery deliveries from the WorldView
satellite constellation under a Service Level Agreement (EnhancedView SLA) in a total amount of
$2.8 billion. The agreement also provides for up to $750 million for value added products,
infrastructure enhancements and other services.
The agreement has a ten year term, inclusive of nine one-year options exercisable by NGA, and is
subject to Congressional appropriations and the right of NGA to terminate or suspend the contract
at any time. The EnhancedView SLA portion of the award is sized at $2.8 billion over the term of
the contract; $250 million annually, or $20.8 million per month, for the first four contract years,
commencing September 1, 2010, with an increase to $300 million annually, or $25 million per month,
for the remaining six years of the agreement term. To support requirements under the agreement,
DigitalGlobe will immediately begin procurement and construction of its next satellite,
WorldView-3, which the Company anticipates will be ready for launch by the end of 2014.
Updated Full-Year 2010 Outlook
As a result on the EnhancedView SLA, DigitalGlobe is updating its full-year 2010 outlook as
follows:
| Full-year 2010 total revenue is expected to be between $340 million and $360 million. |
| Full-year 2010 diluted earnings per share are expected to be between $0.40 and $0.55. |
| Full-year 2010 Adjusted EBITDA is expected to be between $195 million and $210 million, with margins between 57% and 59%. |
| Total capital expenditures for 2010 are expected to be between $110 and $120 million, including between $30 and $35 million related to maintenance and between $80 and $85 million related to incremental capital required to meet new requirements of the EnhancedView SLA. |
Webcast and Conference Call Information
The company will host a conference call and webcast at 11:30 a.m. MDT (1:30 p.m. EDT) today to
provide additional details on its new EnhancedView SLA and discuss its updated full-year 2010
outlook.
The dial-in numbers and pass code to participate in the conference call via telephone are:
United States 866-713-8564
International 617-597-5312
Pass code: 2406-5551
International 617-597-5312
Pass code: 2406-5551
The conference call can also be accessed online by visiting the investor relations section
of DigitalGlobes website at: www.digitalglobe.com.
A replay of the call will be available for seven days and can be accessed using the following
numbers and pass codes:
United States 888-286-8010
International 617-801-6888
Pass code: 4031-5632
International 617-801-6888
Pass code: 4031-5632
About DigitalGlobe
Longmont, Colorado-based DigitalGlobe (http://www.digitalglobe.com) is a leading global provider of
commercial high-resolution earth imagery products and services. Sourced from our own advanced
satellite constellation, our imagery solutions support a wide variety of uses within defense,
intelligence, and homeland security applications, mapping and analysis, environmental monitoring,
oil and gas exploration, infrastructure management, internet portals and navigation technology.
With our collection sources and comprehensive ImageLibrary (containing more than 1 billion square
kilometers of earth imagery and imagery products) we offer a range of on- and off-line products and
services designed to enable customers to easily access and integrate our imagery into their
business operations and applications. For more information, please visit www.digitalglobe.com.
DigitalGlobe is a registered trademark of DigitalGlobe.
Forward-Looking Statements
This release may contain forward-looking statements. Forward-looking statements relate to future
events or our future financial performance. We generally identify forward-looking statements by
terminology such as may, will, should, expects, plans, anticipates, could, intends,
target, projects, contemplates, believes, estimates, predicts, potential or
continue or the negative of these terms or other similar words, although not all forward-looking
statements contain these words. These statements are only predictions.
Any forward-looking statements contained in this release are based upon our historical performance
and on our current plans, estimates and expectations. The inclusion of this forward-looking
information should not be regarded as a representation that the future plans, estimates or
expectations contemplated by us will be achieved. Such forward-looking statements are subject to
various risks and uncertainties and assumptions relating to our operations, financial results,
financial condition, business, prospects, growth strategy and liquidity. If one or more of these or
other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect,
our actual results may vary materially from those indicated in these statements.
Non-GAAP Financial Measures
Adjusted EBITDA is a key measure used in internal operating reports by management and the board of
directors to evaluate the performance of our operations and is also used by analysts, investment
banks and lenders for the same purpose. Adjusted EBITDA is a measure of our current period
operating performance, excluding charges for capital, depreciation related to prior period capital
expenditures and items which are considered non-core in nature.
We believe that the elimination of certain non-cash and non-operating items enables a more
consistent measurement of period to period performance of our operations, as well as a comparison
of our operating performance to companies in our industry. We believe this measure is particularly
important in a capital intensive industry such as ours, in which our current period depreciation is
not a good indication of our current or future period capital expenditures. The cost to construct
and launch a satellite and build the related ground infrastructure may vary greatly from one
satellite to another, depending on the satellites size, type and capabilities. For example, our
QuickBird satellite, which we are currently depreciating, cost significantly less than our
WorldView-1 or WorldView-2 satellites. Current depreciation expense is not indicative of the
revenue generating potential of the satellites.
Adjusted EBITDA excludes interest income (expense), net, income taxes and loss from early
extinguishment of debt because these items are associated with our capitalization and tax
structures. Adjusted EBITDA excludes depreciation and amortization expense because these non-cash
expenses reflect the impact of prior capital expenditure decisions which are not indicative of
future capital expenditure requirements. Adjusted EBITDA excludes non-cash stock compensation
expense because these are non-cash expenses and loss on derivative instrument because these items
are not related to our primary operations.
We use Adjusted EBITDA in conjunction with traditional GAAP operating performance measures as part
of our overall assessment of our performance and we do not place undue reliance on this measure as
our only measure of operating performance. Adjusted EBITDA is not a recognized term under generally
accepted accounting principles, or GAAP, in the United States and may not be defined similarly by
other companies. Adjusted EBITDA should not be considered an alternative to net income, as an
indication of financial performance, or as an alternative to cash flow from operations as a measure
of liquidity. There are limitations to using non-GAAP financial measures, including the difficulty
associated with comparing companies that use similar performance measures whose calculations may
differ from ours.
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