DigitalGlobe, Inc.
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For the three months ended | For the six months ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
(in millions, except per share data) | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Revenue | $ | 225.7 | $ | 175.5 | $ | 435.4 | $ | 350.9 | ||||||||
Costs and expenses: | ||||||||||||||||
Cost of revenue, excluding depreciation and amortization | 69.7 | 38.1 | 131.0 | 72.6 | ||||||||||||
Selling, general and administrative | 54.0 | 42.8 | 117.1 | 89.2 | ||||||||||||
Depreciation and amortization | 86.3 | 66.9 | 165.8 | 137.9 | ||||||||||||
Restructuring charges | 0.3 | 1.6 | 0.6 | 4.5 | ||||||||||||
Income from operations | 15.4 | 26.1 | 20.9 | 46.7 | ||||||||||||
Interest expense, net | (13.3 | ) | (4.7 | ) | (22.8 | ) | (9.8 | ) | ||||||||
Loss from early extinguishment of debt | — | — | (0.5 | ) | — | |||||||||||
Income (loss) before income taxes | 2.1 | 21.4 | (2.4 | ) | 36.9 | |||||||||||
Income tax (expense) benefit | (0.2 | ) | (7.9 | ) | 2.1 | (13.9 | ) | |||||||||
Equity in earnings from joint ventures, net of tax | 0.8 | (1.3 | ) | 0.8 | (2.2 | ) | ||||||||||
Net income | 2.7 | 12.2 | 0.5 | 20.8 | ||||||||||||
Preferred stock dividends | (1.0 | ) | (1.0 | ) | (2.0 | ) | (2.0 | ) | ||||||||
Net income less preferred stock dividends | 1.7 | 11.2 | (1.5 | ) | 18.8 | |||||||||||
Income allocated to participating securities | (0.1 | ) | (0.5 | ) | — | (0.9 | ) | |||||||||
Net income (loss) available to common stockholders | $ | 1.6 | $ | 10.7 | $ | (1.5 | ) | $ | 17.9 | |||||||
Earnings (loss) per share: | ||||||||||||||||
Basic earnings (loss) per share | $ | 0.03 | $ | 0.17 | $ | (0.02 | ) | $ | 0.28 | |||||||
Diluted earnings (loss) per share | $ | 0.03 | $ | 0.17 | $ | (0.02 | ) | $ | 0.28 | |||||||
Weighted average common shares outstanding: | ||||||||||||||||
Basic | 62.1 | 62.9 | 61.9 | 63.9 | ||||||||||||
Diluted | 63.3 | 63.4 | 61.9 | 64.2 | ||||||||||||
DigitalGlobe, Inc.
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For the three months ended | For the six months ended | |||||||||||||
June 30, | June 30, | |||||||||||||
(in millions) | 2017 | 2016 | 2017 | 2016 | ||||||||||
Net income | $ | 2.7 | $ | 12.2 | $ | 0.5 | $ | 20.8 | ||||||
Depreciation and amortization | 86.3 | 66.9 | 165.8 | 137.9 | ||||||||||
Interest expense, net | 13.3 | 4.7 | 22.8 | 9.8 | ||||||||||
Income tax expense (benefit) | 0.2 | 7.9 | (2.1 | ) | 13.9 | |||||||||
EBITDA | 102.5 | 91.7 | 187.0 | 182.4 | ||||||||||
Merger and integration costs | 2.1 | — | 12.3 | — | ||||||||||
Restructuring charges | 0.3 | 1.6 | 0.6 | 4.5 | ||||||||||
Other re-engineering charges | — | 0.7 | — | 1.6 | ||||||||||
Equity in earnings from joint ventures, net of tax | (0.8 | ) | 1.3 | (0.8 | ) | 2.2 | ||||||||
Loss from early extinguishment of debt | — | — | 0.5 | — | ||||||||||
Adjusted EBITDA | $ | 104.1 | $ | 95.3 | $ | 199.6 | $ | 190.7 | ||||||
DigitalGlobe, Inc.
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For the six months ended |
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June 30, | |||||||||||
(in millions) | 2017 | 2016 | |||||||||
Net cash flows provided by operating activities | $ | 85.4 | $ | 150.7 | |||||||
Capital expenditures (1) | (35.8 | ) | (85.8 | ) | |||||||
Free cash flow (2) | $ | 49.6 | $ | 64.9 |
(1) | Note that capital expenditures includes capitalized interest and capital expenditures. | |
(2) | We modified our definition of free cash flow in the fourth quarter of fiscal year 2016. Prior period amounts have been revised to conform to the current definition. | |
DigitalGlobe, Inc.
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June 30, | December 31, | |||||||
(in millions, except par value) | 2017 | 2016 | ||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 107.3 | $ | 109.3 | ||||
Restricted cash | 3.4 | 2.4 | ||||||
Accounts receivable, net of allowance for doubtful accounts of $1.7 and $1.6, respectively | 147.5 | 114.6 | ||||||
Deferred contract costs | 12.5 | 10.3 | ||||||
Prepaid and other current assets | 19.9 | 23.8 | ||||||
Total current assets | 290.6 | 260.4 | ||||||
Property and equipment, net of accumulated depreciation of $1,544.7 and $1,387.8, respectively | 1,885.6 | 2,002.5 | ||||||
Goodwill | 578.1 | 578.1 | ||||||
Intangible assets, net of accumulated amortization of $47.6 and $39.0, respectively | 78.4 | 87.0 | ||||||
Long-term restricted cash | 8.6 | 4.8 | ||||||
Long-term deferred contract costs | 48.8 | 49.3 | ||||||
Other assets | 32.1 | 27.8 | ||||||
Total assets | $ | 2,922.2 | $ | 3,009.9 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 11.2 | $ | 15.0 | ||||
Current portion of long-term debt | 12.8 | 47.2 | ||||||
Deferred revenue | 85.9 | 86.3 | ||||||
Other accrued liabilities | 50.8 | 70.7 | ||||||
Total current liabilities | 160.7 | 219.2 | ||||||
Long-term debt, net of discount and debt issuance costs | 1,237.7 | 1,242.1 | ||||||
Deferred revenue, non-current | 181.9 | 216.9 | ||||||
Deferred income taxes, net, non-current | 119.8 | 124.0 | ||||||
Other liabilities | 37.0 | 34.8 | ||||||
Total liabilities | $ | 1,737.1 | $ | 1,837.0 | ||||
COMMITMENTS AND CONTINGENCIES | ||||||||
STOCKHOLDERS’ EQUITY | ||||||||
Stockholders’ equity: | ||||||||
Series A convertible preferred stock, $0.001 par value; 0.08 shares authorized; 0.08 shares issued and outstanding at June 30, 2017 and December 31, 2016 |
— | — | ||||||
Common stock; $0.001 par value; 250.0 shares authorized; 77.9 shares issued and 62.3 shares outstanding at June 30, 2017 and 77.0 shares issued and 61.4 shares outstanding at December 31, 2016 | 0.2 | 0.2 | ||||||
Treasury stock, at cost; 15.6 shares at June 30, 2017 and December 31, 2016 | (342.0 | ) | (342.0 | ) | ||||
Additional paid-in capital | 1,527.9 | 1,518.3 | ||||||
Accumulated deficit | (1.0 | ) | (3.6 | ) | ||||
Total stockholders’ equity | 1,185.1 | 1,172.9 | ||||||
Total liabilities and stockholders’ equity | $ | 2,922.2 | $ | 3,009.9 | ||||
DigitalGlobe, Inc.
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For the six months ended | ||||||||
June 30, | ||||||||
(in millions) | 2017 | 2016 | ||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
Net income | $ | 0.5 | $ | 20.8 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation and amortization expense | 165.8 | 137.9 | ||||||
Stock-based compensation expense, net of capitalized stock-based compensation expense | 12.3 | 8.3 | ||||||
Amortization of aerial image library, deferred contract costs and lease incentive | 6.1 | 8.4 | ||||||
Deferred income taxes | (2.1 | ) | 14.0 | |||||
Amortization of debt issuance costs, accretion of debt discount, and other | 1.6 | 6.0 | ||||||
Changes in working capital: | ||||||||
Accounts receivable, net | (32.9 | ) | (8.5 | ) | ||||
Deferred contract costs | (9.1 | ) | (8.0 | ) | ||||
Other current and non-current assets | (0.1 | ) | (2.4 | ) | ||||
Accounts payable | (3.8 | ) | 5.7 | |||||
Accrued liabilities | (17.5 | ) | (4.1 | ) | ||||
Deferred revenue | (35.4 | ) | (27.4 | ) | ||||
Net cash flows provided by operating activities | 85.4 | 150.7 | ||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
Capital expenditures | (35.8 | ) | (85.8 | ) | ||||
Investment in joint venture | — | (7.5 | ) | |||||
Net cash flows used in investing activities | (35.8 | ) | (93.3 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
Payment of debt and capital lease obligations | (42.7 | ) | (3.9 | ) | ||||
Repurchase of common stock | — | (76.8 | ) | |||||
Value of shares surrendered to satisfy employee tax obligations | (7.4 | ) | (2.0 | ) | ||||
Proceeds from exercise of stock options and other | 3.3 | (0.8 | ) | |||||
Net cash flows used in financing activities | (46.8 | ) | (83.5 | ) | ||||
Net increase (decrease) in cash, cash equivalents and restricted cash | 2.8 | (26.1 | ) | |||||
Cash, cash equivalents and restricted cash, beginning of period | 116.5 | 134.0 | ||||||
Cash, cash equivalents and restricted cash, end of period | $ | 119.3 | $ | 107.9 | ||||
SUPPLEMENTAL CASH FLOW INFORMATION: | ||||||||
Cash paid for interest, net of capitalized amounts of $5.1 and $21.8, respectively | 21.0 | 7.4 | ||||||
NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||||||||
Changes to accruals for capital expenditures, including interest, and additions to capital lease obligations | (4.0 | ) | 0.4 | |||||
Non-cash preferred stock dividend accrual | (1.0 | ) | (1.0 | ) | ||||