DigitalGlobe, Inc.
Reconciliation of GAAP Net Income to Adjusted EBITDA
(unaudited)
Three months ended Year ended
December 31, December 31,
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(in millions, except per share data) 2009 2010 2009 2010
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Net income $ 13.8 $ 1.3 $ 47.4 $ 4.1
Depreciation and amortization 18.2 29.6 74.4 118.9
Loss on derivative instrument - - 1.8 -
Loss from early extinguishment of
debt - - 7.7 -
Interest expense - 9.0 (0.1) 39.6
Income taxes 9.0 1.9 31.0 5.4
Amortization of Pre-FOC payment
related to NextView (6.4) (6.3) (25.5) (25.5)
EnhancedView deferred revenue(1) - 24.8 - 24.8
EnhancedView outstanding invoices
not yet paid by NGA - - - 8.3
Stock compensation expense 1.7 2.2 7.2 6.8
------------------------------------ -------- -------- -------- --------
Adjusted EBITDA $ 36.3 $ 62.5 $ 143.9 $ 182.4
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.
(1) Fourth quarter EnhancedView deferred revenue includes $8.3 million invoiced in the third quarter for which cash was received in the fourth quarter.
DigitalGlobe, Inc.
Condensed Consolidated Balance Sheets
(in millions) As of December 31,
--------------------
2009 2010
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ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 97.0 $ 179.3
Restricted cash 7.3 6.7
Accounts receivable, net of allowance for doubtful
accounts of $1.2 and $1.0, respectively 49.7 45.3
Prepaid and current assets 12.0 19.4
Income taxes receivable 3.9 -
Deferred taxes 1.7 62.7
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Total current assets 171.6 313.4
Property and equipment, net of accumulated
depreciation of $361.1 and $478.2, respectively 891.0 879.1
Goodwill 8.7 8.7
Intangibles, net of accumulated amortization of $7.2
and $8.9, respectively 1.8 0.3
Aerial image library, net of accumulated amortization
of $17.1 and $21.1, respectively 5.4 1.9
Long-term restricted cash 16.7 13.6
Long-term deferred contract costs 36.2 42.1
Other assets, net 9.1 7.2
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Total assets $ 1,140.5 $ 1,266.3
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LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 4.3 $ 15.0
Accrued interest 6.2 6.2
Other accrued liabilities 17.9 26.3
Current portion of deferred revenue 32.8 38.9
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Total current liabilities 61.2 86.4
Long-term accrued liability - 6.0
Deferred revenue 239.6 246.2
Deferred lease incentive 5.4 4.6
Long-term debt, net of discount 343.5 346.1
Long-term deferred tax liability 11.3 76.7
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Total liabilities $ 661.0 $ 766.0
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Preferred stock, $0.001 par value; 24,000,000 shares
authorized; no shares issued and outstanding at
December 31, 2009 and December 31, 2010 - -
Common stock; $0.001 par value; 250,000,000 shares
authorized; 45,122,593 shares issued and outstanding
at December 31, 2009 and 46,073,691 shares issued and
outstanding at December 31, 2010 0.2 0.2
Treasury stock, at cost; 44,039 shares at December 31,
2009 and December 31, 2010 (0.7) (0.7)
Additional paid-in capital 496.0 512.7
Accumulated deficit (16.0) (11.9)
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Total stockholders' equity 479.5 500.3
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Total liabilities and stockholders' equity $ 1,140.5 $ 1,266.3
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DigitalGlobe, Inc.
Condensed Consolidated Statements of Cash Flows
(in millions) For the Year Ended December 31,
-------------------------------
2008 2009 2010
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CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 53.8 $ 47.4 $ 4.1
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization expense 75.7 74.4 118.9
EnhancedView deferred revenue - - 24.8
Recognition of pre-FOC payments (25.5) (25.5) (25.5)
Amortization of aerial image library,
deferred contract costs and lease
incentive 1.5 5.3 7.1
Non-cash stock compensation expense 4.2 7.2 6.8
Amortization of debt issuance costs 0.3 - 4.4
Write off of debt financing fees - 5.3 -
Deferred income taxes 34.7 33.6 4.4
Changes in working capital, net of
investing activities:
Accounts receivable, net (3.2) (2.6) 4.3
Accounts receivable from related party 3.0 (0.3) -
Income tax receivable - (3.9) 3.9
Aerial image library (2.6) (6.1) -
Prepaids and other assets 1.9 (6.3) (3.9)
Accounts payable (1.5) 1.5 (1.8)
Accounts payable and accrued liabilities
to related parties (1.1) 3.5 -
Accrued liabilities 8.1 (5.0) 10.6
Deferred contract costs from related
party (10.3) (15.3) -
Deferred contract costs - - (14.2)
Deferred revenue, excluding EnhancedView (1.9) 28.0 13.4
Deferred revenue related party 6.5 2.1 -
Deferred lease incentive 0.8 - 0.2
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Net cash flows provided by operating
activities 144.4 143.3 157.5
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CASH FLOWS FROM INVESTING ACTIVITIES:
Construction in progress additions (131.8) (155.9) (78.3)
Other property, equipment and intangible
additions (10.2) (10.9) (10.6)
Decrease (increase) in restricted cash (0.1) (21.5) 3.8
Settlements from derivative instrument (1.4) (2.8) -
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Net cash flows used in investing
activities (143.5) (191.1) (85.1)
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CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of debt, net of
issuance costs 38.5 330.9 -
Proceeds from initial public offering,
net of issuance costs (2.7) 21.7 (0.3)
Repayment of notes - (270.0) -
Repurchase of common stock - (0.5) -
Proceeds from exercise of stock options 1.2 1.9 10.2
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Net cash flows provided by financing
activities 37.0 84.0 9.9
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Net increase in cash and cash equivalents 37.9 36.2 82.3
Cash and cash equivalents, beginning of
period 22.9 60.8 97.0
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Cash and cash equivalents, end of period $ 60.8 $ 97.0 $ 179.3
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SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest, net of capitalized
amounts of $27.0, $37.4 and $7.8,
respectively $ - $ - $ 30.2
Cash received (paid) for income taxes $ (2.2) $ (2.4) $ 4.2
NON-CASH INVESTING AND FINANCING
ACTIVITIES:
Changes to non-cash construction in
progress accruals, including interest $ 10.1 $ 9.7 $ 16.6
