Summary
Globalstar, Inc. reported revenues of $82.7 million for the fiscal year ended December 31, 2013, representing an 8% increase over the previous year, primarily driven by a significant rise in Duplex service revenue due to the completion of its second-generation satellite constellation in August 2013. This operational improvement led to enhanced service levels and increased subscriber activity. The company also saw growth in its SPOT and Simplex service lines. Despite revenue growth, Globalstar incurred an operating loss of $87.4 million and a net loss of $591.1 million, heavily impacted by non-cash items including significant losses on extinguishment of debt and derivative instruments, largely due to changes in stock price. The company's financial position remains challenging, with substantial debt and ongoing capital expenditure plans, though liquidity is supported by financial arrangements with Thermo and Terrapin. Key risk factors include reliance on these capital commitments, potential for continued operating losses, and the need for future capital, potentially complicated by debt covenants.
Financial Highlights
48 data points| Revenue | $82.71M |
| Cost of Revenue | $13.62M |
| Gross Profit | $69.09M |
| R&D Expenses | $600K |
| SG&A Expenses | $29.89M |
| Operating Expenses | $170.11M |
| Operating Income | -$87.40M |
| Net Income | -$591.12M |
| EPS (Basic) | $-14.40 |
| EPS (Diluted) | $-14.40 |
| Shares Outstanding (Basic) | 41.00M |
| Shares Outstanding (Diluted) | 41.00M |
Key Highlights
- 1Total revenue increased by 8% to $82.7 million in 2013, driven by Duplex service revenue improvements following the completion of the second-generation satellite constellation.
- 2Duplex service revenue grew by 24% year-over-year, reflecting increased subscriber activations and a trend towards higher rate plans.
- 3The company reported a net loss of $591.1 million for 2013, significantly impacted by $109.1 million in losses on extinguishment of debt and $306.0 million in derivative losses.
- 4As of December 31, 2013, Globalstar had $17.4 million in cash and cash equivalents, with significant debt obligations totaling $665.2 million (long-term) and $4.0 million (current).
- 5Capital expenditures for the second-generation satellite constellation and ground infrastructure upgrades were substantial, with significant remaining commitments.
- 6Globalstar's common stock was delisted from the NASDAQ Stock Market and traded on the OTCQB, raising concerns about capital-raising ability and market liquidity.
- 7A material weakness was identified in internal controls related to the valuation of non-cash derivative liabilities, although management stated it was corrected before financial statement issuance.