Inmarsat down by a fifth as maritime slows
Nick Clark is the arts correspondent of The Independent. He joined the newspaper in June 2007, initially reporting on the stock markets. He has covered beats including the City, and technology, media and telecoms and made the switch to arts in December 2011. He has also contributed articles to the sports section.
Friday 05 August 2011
Shares in Inmarsat dived yesterday despite soaring profits in the first half of the year, as it warned that the slowdown in its maritime business would drag on for longer than it had initially expected.
The satellite operator reported a 68 per cent jump in profits to $254.8m in the six months to the end of June, while revenues rose a fifth to $682.9m. Both beat analyst forecasts.
Yet, almost 20 per cent of the company's value was wiped off yesterday as the shares tumbled to 391.3p – even on a torrid day for the markets, the company performed twice as badly as the next largest faller.
Andrew Sukawaty, chairman and chief executive of Inmarsat, said that a co-operation deal with wireless broadband group LightSquared had driven record revenue growth "and is offsetting a slowdown in the growth of our Inmarsat Global MSS revenue". The maritime business has been hit by customers moving onto its cheaper FleetBroadband service, a lower use of voice calls and some users moving to rival providers.
He said that a return to revenue growth was "only a matter of time," but cautioned: "We expect near-term factors will constrain growth for longer than previously anticipated."
Yesterday's statement added that the deal with LightSquare would see it meet full-year profits. The company boosted its interim dividend by 10 per cent and launched a $250m share repurchase programme because of the strength of its balance sheet, Mr Sukawaty added.
Broker Liberum Capital said the fall in share price was "overdone" saying it "materially undervalues" the core business.
- 1 Migrant crisis: Greek soldier saved 20 people singlehandedly off Rhodes beach
- 2 Sofyen Belamouadden murder: The inside story of a crime that horrified Britain
- 3 Company breaks open Apple Watch to discover what it says is 'planned obsolescence'
- 5 UK weather: Britain braced for snow as arctic air mass moves in
Migrant crisis: Greek soldier saved 20 people singlehandedly off Rhodes beach
Ian Brady: Moors murderer announces his support for Ukip and the SNP
Aaron and Melissa Klein: Oregon anti-gay bakers ordered to pay $135,000 after refusing to make cake for same-sex wedding
UK weather: Britain braced for snow as arctic air mass moves in
Bali Nine executions in Indonesia: Death row British grandmother Lindsay Sandiford says she 'just wants to get it over with'
General Election 2015: Chuka Umunna on the benefits of immigration, humility – and his leader Ed Miliband
The sickening truth about food banks that the Tories don't want you to know
Migrant boat disaster: Ukip candidate mocks victims in sickening Twitter post
Nigel Farage wants the BBC to stop making programmes like Doctor Who, Strictly Come Dancing, and Top Gear
Global warming: Scientists say temperatures could rise by 6C by 2100 and call for action ahead of UN meeting in Paris
General Election 2015: Britain would become a 'communist dictatorship' under Ed Miliband and Nicola Sturgeon, claims wife of Michael Gove
iJobs Money & Business
£20000 - £22500 per annum + OTE £30K: SThree: SThree Group have been well esta...
£24000 - £26000 per annum + benefits : Ashdown Group: A highly successful, glo...
£50000 - £55000 per annum: Ashdown Group: Business Analyst - Financial Service...
£18000 - £23000 per annum + OTE £45K: SThree: At SThree, we like to be differe...