DigitalGlobe, Inc.
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For the three months ended | For the nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
(in millions, except per share data) | 2016 | 2015 | 2016 | 2015 | ||||||||||||
Revenue | $ | 181.8 | $ | 173.3 | $ | 532.7 | $ | 520.7 | ||||||||
Costs and expenses: | ||||||||||||||||
Cost of revenue, excluding depreciation and amortization | 39.9 | 34.3 | 112.5 | 110.8 | ||||||||||||
Selling, general and administrative | 46.5 | 49.6 | 135.7 | 159.5 | ||||||||||||
Depreciation and amortization | 64.6 | 70.4 | 202.5 | 206.4 | ||||||||||||
Restructuring charges | 1.0 | 0.4 | 5.5 | 3.0 | ||||||||||||
Income from operations | 29.8 | 18.6 | 76.5 | 41.0 | ||||||||||||
Interest expense, net | (4.0 | ) | (5.6 | ) | (13.8 | ) | (23.7 | ) | ||||||||
Other income, net | — | 1.6 | — | 1.6 | ||||||||||||
Income before income taxes | 25.8 | 14.6 | 62.7 | 18.9 | ||||||||||||
Income tax expense | (9.5 | ) | (4.6 | ) | (23.4 | ) | (5.8 | ) | ||||||||
Equity in earnings from joint ventures, net of tax | (1.3 | ) | (0.4 | ) | (3.5 | ) | (0.4 | ) | ||||||||
Net income | 15.0 | 9.6 | 35.8 | 12.7 | ||||||||||||
Preferred stock dividends | (1.0 | ) | (1.0 | ) | (3.0 | ) | (3.0 | ) | ||||||||
Net income less preferred stock dividends | 14.0 | 8.6 | 32.8 | 9.7 | ||||||||||||
Income allocated to participating securities | (0.7 | ) | (0.4 | ) | (1.5 | ) | (0.4 | ) | ||||||||
Net income available to common stockholders | $ | 13.3 | $ | 8.2 | $ | 31.3 | $ | 9.3 | ||||||||
Earnings per share: | ||||||||||||||||
Basic earnings per share | $ | 0.21 | $ | 0.12 | $ | 0.49 | $ | 0.13 | ||||||||
Diluted earnings per share | $ | 0.21 | $ | 0.12 | $ | 0.49 | $ | 0.13 | ||||||||
Weighted average common shares outstanding: | ||||||||||||||||
Basic | 62.6 | 70.5 | 63.5 | 71.7 | ||||||||||||
Diluted | 63.4 | 70.9 | 64.0 | 72.4 | ||||||||||||
DigitalGlobe, Inc.
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For the three months ended | For the nine months ended | |||||||||||||
September 30, | September 30, | |||||||||||||
(in millions) | 2016 | 2015 | 2016 | 2015 | ||||||||||
Net income | $ | 15.0 | $ | 9.6 | $ | 35.8 | $ | 12.7 | ||||||
Depreciation and amortization | 64.6 | 70.4 | 202.5 | 206.4 | ||||||||||
Interest expense, net | 4.0 | 5.6 | 13.8 | 23.7 | ||||||||||
Income tax expense | 9.5 | 4.6 | 23.4 | 5.8 | ||||||||||
EBITDA | 93.1 | 90.2 | 275.5 | 248.6 | ||||||||||
Restructuring charges | 1.0 | 0.4 | 5.5 | 3.0 | ||||||||||
Other re-engineering charges | 2.2 | 2.5 | 3.8 | 2.9 | ||||||||||
Joint venture losses, net | 1.3 | 0.4 | 3.5 | 0.4 | ||||||||||
Gain on disposition of subsidiary | — | (1.6 | ) | — | (1.6 | ) | ||||||||
Adjusted EBITDA | $ | 97.6 | $ | 91.9 | $ | 288.3 | $ | 253.3 | ||||||
DigitalGlobe, Inc.
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For the three months ended | For the nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
(in millions) | 2016 |
2015 |
2016 | 2015 | ||||||||||||
Net cash flows provided by operating activities | $ | 66.1 | $ | 85.6 | $ | 214.7 | $ | 237.5 | ||||||||
Net cash flows used in investing activities | (68.5 | ) | (34.1 | ) | (161.3 | ) | (106.3 | ) | ||||||||
Investment in joint venture | 2.5 | — | 10.0 | 5.0 | ||||||||||||
Free cash flow | $ | 0.1 | $ | 51.5 | $ | 63.4 | $ | 136.2 | ||||||||
DigitalGlobe, Inc.
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September 30, | December 31, | |||||||
(in millions, except par value) | 2016 | 2015 | ||||||
ASSETS | ||||||||
Current Assets: | ||||||||
Cash and cash equivalents | $ | 87.9 | $ | 126.1 | ||||
Restricted cash | 2.4 | 3.6 | ||||||
Accounts receivable, net of allowance for doubtful accounts of $1.7 and $2.8, respectively | 104.5 | 90.8 | ||||||
Deferred contract costs | 12.1 | 13.5 | ||||||
Prepaid and other current assets | 20.7 | 17.4 | ||||||
Total current assets | 227.6 | 251.4 | ||||||
Property and equipment, net of accumulated depreciation of $1,334.3 and $1,179.4, respectively | 2,027.3 | 2,080.2 | ||||||
Goodwill | 484.1 | 484.1 | ||||||
Intangible assets, net of accumulated amortization of $35.8 and $29.6, respectively | 26.7 | 32.9 | ||||||
Long-term restricted cash | 5.0 | 4.3 | ||||||
Long-term deferred contract costs | 49.7 | 47.1 | ||||||
Other assets | 23.5 | 13.2 | ||||||
Total assets | $ | 2,843.9 | $ | 2,913.2 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current Liabilities: | ||||||||
Accounts payable | $ | 8.3 | $ | 3.9 | ||||
Current portion of long-term debt | 5.5 | 5.5 | ||||||
Deferred revenue | 86.0 | 80.3 | ||||||
Other accrued liabilities | 53.4 | 64.4 | ||||||
Total current liabilities | 153.2 | 154.1 | ||||||
Long-term debt, net of discount and debt issuance costs | 1,104.4 | 1,104.4 | ||||||
Deferred revenue, non-current | 233.2 | 284.0 | ||||||
Deferred income taxes, net, non-current | 112.8 | 86.4 | ||||||
Other liabilities | 35.1 | 36.2 | ||||||
Total liabilities | $ | 1,638.7 | $ | 1,665.1 | ||||
COMMITMENTS AND CONTINGENCIES | ||||||||
STOCKHOLDERS’ EQUITY | ||||||||
DigitalGlobe, Inc. stockholders’ equity: | ||||||||
Series A convertible preferred stock, $0.001 par value; 0.08
shares authorized;
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— | — | ||||||
Common stock; $0.001 par value; 250.0 shares authorized; 76.9
shares issued
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0.2 | 0.2 | ||||||
Treasury stock, at cost; 14.5 shares at September 30, 2016 and 9.2
shares at
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(312.5 | ) | (225.8 | ) | ||||
Additional paid-in capital | 1,511.8 | 1,502.8 | ||||||
Retained earnings (accumulated deficit) | 5.7 | (29.1 | ) | |||||
Total stockholders’ equity | 1,205.2 | 1,248.1 | ||||||
Total liabilities and stockholders’ equity | $ | 2,843.9 | $ | 2,913.2 | ||||
DigitalGlobe, Inc.
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For the nine months ended | ||||||
September 30, | ||||||
(in millions) | 2016 | 2015 | ||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||
Net income | $ | 35.8 | $ | 12.7 | ||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||
Depreciation and amortization expense | 202.5 | 206.4 | ||||
Stock-based compensation expense, net of capitalized stock-based
compensation
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12.9 | 14.2 | ||||
Amortization of aerial image library, deferred contract costs and lease incentive |
12.3 | 12.3 | ||||
Deferred income taxes | 23.4 | 5.1 | ||||
Excess tax benefit from share-based compensation | (0.2) | (1.3) | ||||
Amortization of debt issuance costs, accretion of debt discount, and other | 10.2 | 3.8 | ||||
Changes in working capital: | ||||||
Accounts receivable, net | (13.7) | 46.2 | ||||
Deferred contract costs | (13.1) | (13.1) | ||||
Other current and non-current assets | (10.2) | 2.5 | ||||
Accounts payable | 2.3 | (1.8) | ||||
Accrued liabilities | (2.4) | 5.8 | ||||
Deferred revenue | (45.1) | (55.3) | ||||
Net cash flows provided by operating activities | 214.7 | 237.5 | ||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||
Construction in progress additions | (154.6) | (97.9) | ||||
Property and equipment additions | (0.2) | (2.5) | ||||
Proceeds from sale of property | 3.0 | — | ||||
Decrease (increase) in restricted cash | 0.5 | (0.9) | ||||
Investment in joint venture | (10.0) | (5.0) | ||||
Net cash flows used in investing activities | (161.3) | (106.3) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||
Payment of debt and capital lease obligations | (4.7) | (4.6) | ||||
Repurchase of common stock | (86.4) | (100.5) | ||||
Proceeds from exercise of stock options | 2.3 | 5.4 | ||||
Preferred stock dividend payment | (3.0) | (3.0) | ||||
Excess tax benefit from share-based compensation | 0.2 | 1.3 | ||||
Net cash flows used in financing activities | (91.6) | (101.4) | ||||
Net (decrease) increase in cash and cash equivalents | (38.2) | 29.8 | ||||
Cash and cash equivalents, beginning of period | 126.1 | 117.8 | ||||
Cash and cash equivalents, end of period | $ | 87.9 | $ | 147.6 | ||
SUPPLEMENTAL CASH FLOW INFORMATION: | ||||||
Cash paid for interest, net of capitalized amounts of $40.1 and $28.2, respectively | 11.5 | 22.6 | ||||
NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||||||
Changes to non-cash property, equipment and construction in
progress accruals,
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9.4 | 1.3 | ||||
Non-cash preferred stock dividend accrual | (1.0) | (1.0) | ||||